10-Q

 UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

[ x ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended: October 31, 2020

[   ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from _______ to _______

Commission file number:  000-55321

I-MINERALS INC.

(Exact name of registrant as specified in its charter)

Canada	20-4644299
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

Suite 880, 580 Hornby Street, Vancouver, BC, Canada V6C 3B6

(Address of principal executive offices)(Zip Code)

(877) 303-6573

Registrant’s telephone number, including area code

Not applicable

(Former name or former address if changed since last report)

Securities registered under section 12(g) of the Exchange Act: Common shares with no par value.

Indicate by check mark if the registrant is a well-known season issuer, as defined in Rule 405 of the Securities Act.  Yes [  ] No [X]

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Exchange Act.  Yes [  ] No [X]

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes [X] No [  ]

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).  Yes [X] No [  ]

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of Registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K.  [  ]

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company.

Large accelerated filer	[  ]	Accelerated filer	[  ]
Non-accelerated filer	[  ]	Smaller reporting company	[X]
(Do not check if a smaller reporting company)		Emerging growth company	[X]

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.  [  ]

Indicate by check mark whether the registrant is a shell company (as defined in rule 12b-2 of the Exchange Act). Yes [  ] No [X]

As of December 11, 2020, the registrant had 93,730,212 outstanding shares of common stock.

I-Minerals Inc.

TABLE OF CONTENTS

Part I. Financial Information		3
Item 1.	Financial Statements (Unaudited)	3
	Condensed interim consolidated balance sheets – October 31, 2020 and April 30, 2020	4
	Condensed interim consolidated statements of loss – Six months ended October 31, 2020 and 2019	5
	Condensed interim consolidated statements of cash flows – Six months ended October 31, 2020 and 2019	6
	Condensed interim consolidated statements of capital deficit – Six months ended October 31, 2020 and 2019	7
	Notes to the condensed interim consolidated financial statements – October 31, 2020	8
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	17
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	22
Item 4.	Controls and Procedures	22
Part II. Other Information		22
Item 1.	Legal Proceedings	22
Item 1A.	Risk Factors	22
Item 2.	Unregistered Sales of Equity Securities and use of Proceeds	22
Item 3.	Defaults Upon Senior Securities	22
Item 4.	Mine Safety Disclosures	22
Item 5.	Other Information	22
Item 6.	Exhibits	23
Signatures		24

2

PART I – FINANCIAL INFORMATION

I-Minerals Inc.

Condensed Interim Consolidated Financial Statements

For the six months ended October 31, 2020 and 2019

(Unaudited - Expressed in US dollars)

3

I-Minerals Inc.
Condensed Interim Consolidated Balance Sheets
October 31, 2020 and April 30, 2020

(Unaudited - Expressed in US dollars)
(Prepared in accordance with US GAAP)

	Notes	October 31, 2020 $	April 30, 2020 $
ASSETS
Current assets
Cash		53,041	347,887
Receivables		5,373	9,184
Prepaids		20,776	18,816
		79,190	375,887
Equipment and right-of-use asset		59,194	14,860
Mineral property interest and deferred development costs	3	1,892,410	1,892,410
Deposits		29,208	29,208
TOTAL ASSETS		2,060,002	2,312,365
LIABILITIES
Current liabilities
Accounts payable and accrued liabilities	4,8	1,904,662	1,743,094
Lease liability – current	5	27,982	-
Promissory notes due to related party	6	29,514,334	27,589,617
Derivative liabilities		-	16,541
		31,446,978	29,349,252
Lease liability – non-current	5	21,066	-
TOTAL LIABILITIES		31,468,044	29,349,252
CAPITAL DEFICIT
Capital Stock
Authorized:
Unlimited common shares with no par value
Issued and fully paid: 93,730,212 (April 30, 2020 – 93,730,212)	7	19,225,087	19,225,087
Additional paid-in capital		1,865,342	1,865,342
Deficit		(50,498,471)	(48,127,316)
TOTAL CAPITAL DEFICIT		(29,408,042)	(27,036,887)
TOTAL LIABILITIES AND CAPITAL DEFICIT		2,060,002	2,312,365

Basis of Presentation and Going Concern (Note 1)

Subsequent events (Note 11)

On behalf of the Board
“John Theobald”             Director	“W. Barry Girling”             Director

 The accompanying notes are an integral part of these condensed interim consolidated financial statements. 

4

I-Minerals Inc.
Condensed Interim Consolidated Statements of Loss
For the three and six months ended October 31, 2020 and 2019

(Unaudited - Expressed in US dollars)

	Notes	Three months ended October 31,		Six months ended October 31,
		2020	2019	2020	2019
		$	$	$	$
OPERATING EXPENSES
Amortization		808	981	5,870	3,305
Management and consulting fees	8	50,365	44,569	100,524	101,513
Mineral property expenditures		159,971	444,967	298,461	724,205
General and miscellaneous		50,758	72,928	88,670	136,811
Professional fees	8	27,069	49,030	97,451	111,398
		(288,971)	(612,475)	(590,976)	(1,077,232)
OTHER (EXPENSE) INCOME
Foreign exchange (gain) loss		(1,046)	(1,310)	6,933	(1,015)
Accretion expense		-	(34,810)	-	(60,348)
Interest expense	6	(913,544)	(751,201)	(1,803,653)	(1,488,711)
Change in fair value of derivative liabilities		-	7,457	-	3,143
LOSS FOR THE PERIOD		(1,203,561)	(1,392,339)	(2,387,696)	(2,624,163)
Loss per share – basic and diluted		(0.01)	(0.02)	(0.03)	(0.03)
Weighted average number of shares outstanding		93,730,212	92,676,115	93,730,212	92,676,115

The accompanying notes are an integral part of these condensed interim consolidated financial statements.

5

I-Minerals Inc.
Condensed Interim Consolidated Statements of Cash Flows
For the six months ended October 31, 2020 and 2019 

(Unaudited - Expressed in US dollars)

	2020 $	2019 $
OPERATING ACTIVITIES
Net loss for the period	(2,387,696)	(2,624,163)
Items not involving cash:
Amortization	5,870	3,305
Stock-based compensation	-	888
Accretion expense	-	60,348
Change in fair value of derivative liabilities	-	(3,143)
Change in non-cash operating working capital items:
Receivables	3,811	(315)
Prepaids	(1,960)	15,326
Accounts payable and accrued liabilities	1,836,285	1,667,750
Lease liability	(277)	-
Cash flows used in operating activities	(543,967)	(880,004)
INVESTING ACTIVITIES
Additions to mineral property interest and deferred development	-	(4,953)
Purchase of equipment	(879)	(2,658)
Cash flows used in investing activities	(879)	(7,611)
FINANCING ACTIVITIES
Proceeds from promissory notes received	250,000	680,000
Cash flows from financing activities	250,000	680,000
DECREASE IN CASH	(294,846)	(207,615)
CASH, BEGINNING OF THE PERIOD	347,887	241,721
CASH, END OF THE PERIOD	53,041	34,106
SUPPLEMENTAL CASH FLOW INFORMATION (Note 10)
Interest paid	-	-
Taxes paid	-	-

The accompanying notes are an integral part of these condensed interim consolidated financial statements.

6

I-Minerals Inc.
Condensed Interim Consolidated Statements of Capital Deficit
For the six months ended October 31, 2020 and 2019 

(Unaudited - Expressed in US dollars)

	Number of Shares #	Amount $	Commitment to Issue Shares $	Additional Paid-in Capital $	Accumulated Deficit $	Total Capital Deficit $
Balance at April 30, 2019	92,676,115	19,118,229	106,858	1,866,274	(43,010,566)	(21,919,205)
Share-based payments - vesting	-	-	-	888	-	888
Reallocation of vested options to liabilities	-	-	-	(1,820)	-	(1,820)
Loss for the period	-	-	-	-	(2,624,163)	(2,624,163)
Balance at October 31, 2019	92,676,115	19,118,229	106,858	1,865,342	(45,634,729)	(24,544,300)
Issued during the period:
Shares issued as a debt discount	1,054,097	106,858	(106,858)	-	-	-
Share-based payments - vesting	-	-	-	-	-	-
Reallocation of vested options to liabilities	-	-	-	-	-	-
Loss for the period	-	-	-	-	(2,492,587)	(2,492,587)
Balance at April 30, 2020	93,730,212	19,225,087	-	1,865,342	(48,127,316)	(27,036,887)
Adoption of ASU 2018-07 adjustment (Note 2)	-	-	-	-	16,541	16,541
Balance at May 1, 2020 (restated)	93,730,212	19,225,087	-	1,865,342	(48,110,775)	(27,020,346)
Loss for the period	-	-	-	-	(2,387,696)	(2,387,696)
Balance at October 31, 2020	93,730,212	19,225,087	-	1,865,342	(50,498,471)	(29,408,042)

The accompanying notes are an integral part of these condensed interim consolidated financial statements.

7

I-Minerals Inc.
Notes to the Condensed Interim Consolidated Financial Statements
For the six months ended October 31, 2020 and 2019 

(Unaudited - Expressed in US dollars except where otherwise indicated)

1. NATURE OF BUSINESS AND BASIS OF PRESENTATION AND LIQUIDITY:

I-Minerals Inc. (the “Company”) was incorporated under the laws of British Columbia, Canada, in 1984.  The Company is listed for trading on the TSX Venture Exchange under the symbol “IMA” and the OTCQB marketplace under the symbol “IMAHF”.  

The Company’s principal business is the development of the Helmer-Bovill industrial mineral property (“the Property”) located in Latah County, Idaho.  Since inception, the Company has been in the exploration and evaluation stage but moved into the development stage in fiscal 2018.  In fiscal 2019, the Company reverted back to the evaluation stage as management determined that the Feasibility Study on the property should be considered non-current.  The Helmer-Bovill property is comprised of eleven mineral leases that host potentially economic deposits of feldspar, quartz and kaolinitic clays, primarily kaolinite and halloysite.

Basis of Presentation and Going Concern

The accompanying unaudited condensed interim consolidated financial statements have been prepared by the Company in accordance with accounting principles generally accepted in the United States of America (“US GAAP”) for interim financial information as well as Article 10 of Regulation S-X on the basis that the Company will continue as a going concern, which assumes that the Company will be able to meet its obligations and continue its operations for the next year.  Realization values may be substantially different from carrying values as shown and these financial statements do not give effect to adjustments that would be necessary to the carrying values and classification of assets and liabilities should the Company be unable to continue as a going concern.  At October 31, 2020, the Company had not yet achieved profitable operations, had an accumulated deficit of $50,498,471 since inception and expects to incur further losses in the development of its business, all of which casts substantial doubt upon the Company’s ability to continue as a going concern and, therefore, that it may be unable to realize its assets and discharge its liabilities in the normal course of business.

The Company’s ability to continue as a going concern is dependent upon its ability to obtain the necessary financing to develop the Property and to meet its obligations and repay its liabilities arising from normal business operations when they come due.  Although the Company has been successful in the past in obtaining financing, there is no assurance that it will be able to obtain adequate financing in the future or that such financing will be on terms advantageous to the Company.  The Company has been receiving funds from a company controlled by a director of the Company through promissory notes (Notes 6 and 11).  Management has no formal plan in place to address this concern but considers that the Company will be able to obtain additional funds by equity financing and/or promissory notes; however, there is no assurance of additional funding being available.  The Company has historically satisfied its capital needs primarily by issuing equity securities and/or promissory notes.  Management plans to continue to provide for its capital needs by issuing equity securities and/or promissory notes.

On January 30, 2020, the World Health Organization ("WHO") announced a global health emergency because of a new strain of coronavirus originating in Wuhan, China (the "COVID-19 outbreak”) and the risk to the international community as the virus spreads globally beyond its point of origin. In March 2020, the WHO classified the COVID-19 outbreak as a pandemic, based on the rapid increase in exposure globally.

The full impact of the COVID-19 outbreak continues to evolve. As such, it is uncertain as the full magnitude that the pandemic will have on the Company's financial condition and liquidity.  Management is actively monitoring the global situation and its potential impact. Given the daily evolution of the COVID-19 outbreak and the global responses to curb its spread, the Company is not able to estimate the effect of the COVID-19 outbreak on management's assumptions for fiscal year 2021. Although the Company cannot estimate the length or the gravity of the impact of the COVID-19 outbreak at this time, the longer the pandemic continues, the greater the likelihood that it will have an adverse effect on the Company's financial position in fiscal year 2021.

8

I-Minerals Inc.
Notes to the Condensed Interim Consolidated Financial Statements
For the six months ended October 31, 2020 and 2019 

(Unaudited - Expressed in US dollars except where otherwise indicated)

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:

Financial Instruments and Fair Value Measures

The book value of cash, receivables, accounts payable and accrued liabilities approximate their fair values due to the immediate or short-term maturity of those instruments.  The fair value hierarchy under US GAAP is based on three levels of inputs, of which the first two are considered observable and the last unobservable, that may be used to measure fair value which are the following:

Level 1 -       quoted prices (unadjusted) in active markets for identical assets or liabilities;

Level 2 -       observable inputs other than Level I, quoted prices for similar assets or liabilities in active prices whose inputs are observable or whose significant value drivers are observable; and

Level 3 -       assets and liabilities whose significant value drivers are unobservable by little or no market activity and that are significant to the fair value of the assets or liabilities.

The Company’s promissory notes are based on Level 2 inputs in the Accounting Standards Codification (“ASC”) 820 fair value hierarchy. The Company calculated the fair value of these instruments by discounting future cash flows using rates representative of current borrowing rates. At October 31, 2020, the promissory notes had a fair value of $19,627,032 (April 30, 2020 – $18,347,095).

Earnings (Loss) Per Share

The basic loss per common share is computed by dividing net loss available to common stockholders by the weighted average number of common shares outstanding. Diluted loss per common share is computed similar to basic loss per common share except that the denominator is increased to include the number of additional common shares that would have been outstanding if the potential common shares had been issued and if the additional common shares were dilutive. For the six months ended October 31, 2020, loss per share excludes 2,750,000 (October 31, 2019 – 5,979,097) potentially dilutive common shares (related to outstanding options and warrants as well as shares committed to be issued pursuant to the promissory notes) as their effect was anti-dilutive.

Adoption of New Accounting Pronouncements

Fair Value Measurements

In August 2018, the Financial Accounting Standards Board (“FASB”) issued ASU No. 2018-13, "Disclosure Framework—Changes to the Disclosure Requirements for Fair Value Measurement" which adds the disclosure of the range and weighted average of significant unobservable inputs used to develop Level 3 fair value measurements. Certain alternatives apply.  Effective May 1, 2020, the Company adopted the new standard. The adoption of this ASU did not result in any adjustments to the financial statements.

Compensation – Stock Compensation

In June 2018, the FASB issued ASU No. 2018-07, “Compensation – Stock Compensation (Topic 718), Improvements to Nonemployee Share-Based Payment Accounting” (“ASU 2018-07”), which aligns the measurement and classification guidance for share-based payments to nonemployees with that for employees, with certain exceptions.  It expands the scope of ASC 718 to include share-based payments granted to nonemployees in exchange for goods or services used or consumed in the entity’s own operations and supersedes the guidance in ASC 505-50.  The ASU retains the existing cost attribution guidance, which requires entities to recognize compensation cost for nonemployee awards in the same period and in the same manner (i.e. capitalize or expense) they would if they paid cash for the goods or services, but it moves the guidance to ASC 718. Effective May 1, 2020, the Company adopted the new standard. Upon adoption, the Company applied the modified retrospective transition approach and recorded an adjustment on May 1, 2020 to decrease derivative liabilities by $16,541 and decrease opening deficit by $16,541.

9

I-Minerals Inc.
Notes to the Condensed Interim Consolidated Financial Statements
For the six months ended October 31, 2020 and 2019 

(Unaudited - Expressed in US dollars except where otherwise indicated)

3. MINERAL PROPERTY INTEREST AND DEFERRED DEVELOPMENT COSTS:

Helmer-Bovill Property – Latah County, Idaho

The Company has an undivided 100% interest in 11 State of Idaho mineral leases.  The State of Idaho mineral leases are subject to a 5% production royalty on gross sales.  The mineral leases are in good standing until March 1, 2023 at which time they will be held by us contingent on production. 

In May 2017, the Idaho Department of Lands accepted our operation and reclamation plan.  Together with a water rights permit from the Idaho Department of Water Resources, we were able to proceed with development and construction of the mine, subject to obtaining sufficient financing.  As a result, management made the decision to begin capitalizing all development expenditures directly related to the Helmer-Bovill Property.  In February 2019, the Company determined that the Feasibility Study should be considered non-current and accordingly, the Company has returned to the evaluation stage for accounting purposes.

4. ACCOUNTS PAYABLE AND ACCRUED LIABILITIES:

	October 31, 2020 $	April 30, 2020 $
Trade payables	169,025	157,419
Amounts due to related parties (Note 8)	220,130	199,104
Interest payable on promissory notes (Note 6)	1,515,507	1,386,571
Total accounts payable and accrued liabilities	1,904,662	1,743,094

5. LEASE LIABILITY:

The Company entered into a property lease in October 2020 and the Company recognized a lease obligation with respect to the operating lease.  The terms and the outstanding balances as at October 31, 2020 are as follows:

	October 31, 2020 $
Right-of-use asset from property lease repayable in monthly instalments of $2,332 and an interest rate of 13% per annum and an end date of October 15, 2022	49,048
Less: current portion	(27,982)
Non-current portion	21,066

10

I-Minerals Inc.
Notes to the Condensed Interim Consolidated Financial Statements
For the six months ended October 31, 2020 and 2019 

(Unaudited - Expressed in US dollars except where otherwise indicated)

The following is a schedule of the Company’s future minimum lease payments related to the office lease obligation:

	October 31, 2020 $
2021	13,991
2022	27,982
2023	13,991
Total minimum lease payments	55,964
Less: imputed interest	(6,916)
Total present value of minimum lease payments	49,048
Less: current portion	(27,982)
Non-current portion	21,066

6. PROMISSORY NOTES:

	October 31, 2020 $	April 30, 2020 $
Third promissory notes	24,906,446	23,493,003
Fifth promissory notes	2,989,937	2,793,833
Sixth promissory notes	1,617,951	1,302,781
Total promissory notes	29,514,334	27,589,617

The Company has Third Promissory Notes, Fifth Promissory Notes and Sixth Promissory Notes due to a company controlled by a director of the Company (the “Lender”).  The Third Promissory Notes were due on March 31, 2019.  On March 27, 2019, an amending agreement was entered into extending the maturity date of the Promissory Notes from March 31, 2019 to June 30, 2019 for no consideration.  On June 28, 2019, the Company entered into an amending agreement with the Lender further extending this maturity date to October 31, 2019 for no consideration.  The Fifth Promissory Notes were due on December 31, 2019.  On October 25, 2019, the Company entered into an amending agreement with the Lender extending the maturity date for both notes, for no consideration, to the earlier of (i) June 30, 2020 and (ii) 60 days after a pre-feasibility study has been filed on SEDAR.  The Sixth Promissory Notes have the same maturity date. On June 4, 2020, all three promissory notes were extended to December 15, 2020 for no consideration.  On December 3, 2020, the maturity date was extended to March 15, 2021 for no consideration.

In accordance with the guidance of ASC 470-50 and ASC 470-60, the Company determined that the March 27, 2019, June 28, 2019, October 25, 2019 and June 4, 2020 extension agreements qualified as troubled debt restructurings.  However, as the Company did not transfer assets or grant an equity interest to the Lender and since the carrying amount of the promissory notes at the time of the restructurings did not exceed the total future cash payments specified by the new terms, there was no accounting impact of the troubled debt modifications.

Certain conditions may result in early repayment including immediate repayment in the event a person currently not related to the Company acquires more than 40% of the outstanding common shares of the Company.

Third Promissory Notes

The Third Promissory Notes bear interest at the rate of 12% per annum and during the six months ended October 31, 2020, the Company recorded interest of $1,492,264 (2019 - $1,327,764).  Interest is payable semi-annually as calculated on May 31^st and November 30^th of each year.  Interest is to be paid either in cash, in common shares or deemed an advance of principal at the option of the Lender.  A 5% late payment penalty may apply if payment is not paid within ten days after the due date.  During the six months ended October 31, 2020, the Lender elected to have interest payable from December 1, 2019 to May 31, 2020 of $1,413,443 deemed as advances. 

11

I-Minerals Inc.
Notes to the Condensed Interim Consolidated Financial Statements
For the six months ended October 31, 2020 and 2019 

(Unaudited - Expressed in US dollars except where otherwise indicated)

Fifth Promissory Notes

On September 11, 2018, the Company entered into a Loan Agreement with the Lender pursuant to which up to $2,500,000 will be advanced to the Company in tranches (the “Fifth Promissory Notes”).  As at October 31, 2020, the Company had received $2,500,000 (April 30, 2020 - $2,500,000) in advances pursuant to the Fifth Promissory Notes. 

The Fifth Promissory Notes bear interest at the rate of 14% per annum and during the six months ended October 31, 2020, the Company recorded interest of $208,684 (2019 - $160,947). Interest is payable semi-annually as calculated on May 31^st and November 30^th of each year.  Interest is to be paid either in cash, in common shares or deemed an advance of principal at the option of the Lender.  A 5% late payment penalty may apply if payment is not paid within ten days after the due date.  During the six months ended October 31, 2020, the Lender elected to have interest payable from December 1, 2019 to May 31, 2020 of $196,104 deemed as advances. 

Sixth Promissory Notes

On October 25, 2019, the Company entered into a Loan Agreement with the Lender pursuant to which up to $700,000 will be advanced to the Company in tranches (the “Sixth Promissory Notes”).  On January 20, 2020 and July 8, 2020, the Company entered into amending agreements whereby the Lender agreed to advance an additional $600,000 and $1,200,000, respectively, under the same terms as the Sixth Promissory Notes.  As at October 31, 2020, the Company had received $1,550,000 in advances pursuant to the Sixth Promissory Notes (April 30, 2020 - $1,300,000).

The Sixth Promissory Notes bear interest at the rate of 14% per annum and during the six months ended October 31, 2020, the Company recorded interest of $102,705 (2019 - $nil). Interest is payable semi-annually as calculated on May 31^st and November 30^th of each year.  Interest is to be paid either in cash, in common shares or deemed an advance of principal at the option of the Lender.  A 5% late payment penalty may apply if payment is not paid within ten days after the due date. During the six months ended October 31, 2020, the Lender elected to have interest payable from December 1, 2019 to May 31, 2020 of $65,170 deemed as advances. 

The Third Promissory Notes, the Fifth Promissory Notes and the Sixth Promissory Notes are collateralized by the Company’s Helmer-Bovill Property.

The following table outlines the estimated cash payments required, by calendar year, in order to repay the principal balance of the Third Promissory Notes, the Fifth Promissory Notes and the Sixth Promissory Notes:

2020 $	2021 $	2022 $	2023 $	2024 $	Total $
29,514,334	-	-	-	-	29,514,334

7. SHARE CAPITAL:

Common shares

a) Authorized:

Unlimited number of common shares, without par value.

12

I-Minerals Inc.
Notes to the Condensed Interim Consolidated Financial Statements
For the six months ended October 31, 2020 and 2019 

(Unaudited - Expressed in US dollars except where otherwise indicated)

The holders of common shares are entitled to receive dividends which are declared from time to time, and are entitled to one vote per share at meetings of the Company. All shares are ranked equally with regards to the Company’s residual assets.

b) Stock transactions:

During the six months ended October 31, 2020 or 2019, the Company did not complete any stock transactions.

c) Stock options:

The Company has granted stock options under the terms of its Stock Option Plan (the “Plan”).  The Plan provides that the directors of the Company may grant options to purchase common shares to directors, officers, employees and service providers of the Company on terms that the directors of the Company may determine are within the limitations set forth in the Plan.  The maximum number of shares available under the Plan is limited to 10% of the issued common shares.  The maximum term of stock options is ten years.  All stock options vest on the date of grant, unless otherwise stated.  As at October 31, 2020, the Company had 6,623,021 stock options available for grant pursuant to the Plan (April 30, 2020 – 6,423,021).

The Company’s stock options outstanding as at October 31, 2020 and the changes for the period then ended are as follows:

	Number Outstanding	Weighted Average Exercise Price (in CAD$)
Balance outstanding at April 30, 2020	2,950,000	0.26
Expired	(200,000)	0.25
Balance outstanding at October 31, 2020	2,750,000	0.26
Balance exercisable at October 31, 2020	1,500,000	0.26

Summary of stock options outstanding at October 31, 2020:

Security	Number Outstanding	Number Exercisable	Exercise Price (CAD$)	Expiry Date	Remaining Contractual Life (years)
Stock options	300,000	300,000	0.30	July 21, 2021	0.72
Stock options	1,000,000	1,000,000	0.25	April 20, 2022	1.47
Stock options	(1)1,450,000	(1)200,000	0.25	August 9, 2023	2.77

Notes:

⁽¹⁾ 1,250,000 stock options vest on the completion of certain milestones including equity financing, project financing, mine construction and achieving commercial production. 200,000 stock options vested as to 25% every three months from the date of grant.

As at October 31, 2020, the unamortized compensation cost of options is $93,382 and the intrinsic value of options expected to vest is $nil.

Share-based payments are classified in the Company’s Statement of Loss during the six months ended October 31, 2020 and 2019 as follows:

13

I-Minerals Inc.
Notes to the Condensed Interim Consolidated Financial Statements
For the six months ended October 31, 2020 and 2019 

(Unaudited - Expressed in US dollars except where otherwise indicated)

	2020 $	2019 $
Management and consulting fees	-	888
	-	888

8. RELATED PARTY TRANSACTIONS:

During the six months ended October 31, 2020, management and consulting fees of $48,000 (2019 - $48,000) were charged by RJG Capital Corporation, a wholly-owned company of W. Barry Girling, Director.  Wayne Moorhouse, Director, charged $8,320 (2019 - $8,320) in management and consulting fees.  Gary Childress, Director, charged $6,705 (2019 - $6,805) in management and consulting fees.  $12,350 (2019 - $12,760) was charged by Malaspina Consultants Inc. for the services of Matt Anderson, CFO, and are included in professional fees. 

Included in accounts payable and accrued liabilities are amounts owed to directors or officers or companies controlled by them.  As at October 31, 2020, the amount was $220,130 (April 30, 2020 – $199,104).  All amounts are non-interest bearing, unsecured, and due on demand.

The promissory notes received from a company controlled by a director (Note 6) are related party transactions.

9. SEGMENT DISCLOSURES:

The Company considers its business to comprise a single operating segment being the exploration and development of its resource property.  Substantially all of the Company’s long-term assets and operations are located in Latah County, Idaho. 

10. NON-CASH TRANSACTIONS:

Investing and financing activities that affect recognized assets or liabilities but that do not result in cash receipts or cash payments are excluded from the consolidated statements of cash flows.  During the six months ended October 31, 2020, the following transactions were excluded from the consolidated statement of cash flows:

a) The transfer of $1,674,717 of interest payable on the Third, Fifth and Sixth Promissory Notes from accounts payable and accrued liabilities to promissory notes; and,

b) Deferred mineral property expenditures of $40,062 included in accounts payable and accrued liabilities at October 31, 2020, less $40,062 included in accounts payable at April 30, 2020 (net inclusion of $nil).

During the six months ended October 31, 2019, the following transactions were excluded from the consolidated statement of cash flows:

a) The transfer of $1,358,420 of interest payable on the Third and Fifth Promissory Notes from accounts payable and accrued liabilities to promissory notes; and,

b) Deferred mineral property expenditures of $52,791 included in accounts payable and accrued liabilities at October 31, 2019, less $57,744 included in accounts payable at April 30, 2019 (net inclusion of $4,953).

14

I-Minerals Inc.
Notes to the Condensed Interim Consolidated Financial Statements
For the six months ended October 31, 2020 and 2019 

(Unaudited - Expressed in US dollars except where otherwise indicated)

11. SUBSEQUENT EVENTS:

Subsequent to October 31, 2020:

i) On November 5, 2020, the Company received $100,000 pursuant to the Sixth Promissory Notes and on December 3, 2020 the Company received $200,000.

ii) On December 3, 2020, the maturity date of the promissory notes was extended to March 15, 2021 for no consideration.

15

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

Certain statements contained in this Quarterly Report constitute "forward-looking statements.” These statements, identified by words such as “plan,” "anticipate,” "believe,” "estimate,” "should,” "expect" and similar expressions include our expectations and objectives regarding our future financial position, operating results and business strategy. Forward-looking statements involve known and unknown risks, uncertainties, assumptions and other factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. Such factors include, among others, general business, economic, competitive, political and social uncertainties; the actual results of current exploration and development activities; changes in project parameters as plans continue to be refined; changes in labour costs or other costs of production; future mineral prices; equipment or processes to operate as anticipated; accidents, labour disputes and other risks of the mining industry, including but not limited to environmental hazards, cave-ins, pit-wall failures, flooding, rock bursts and other acts of God or unfavourable operating conditions and losses; delays in obtaining governmental approvals or financing or in the completion of development or construction activities, as well as those factors discussed in the section titled "Risk Factors" in our Annual Report on Form 10-K which was filed with the SEC on July 28, 2020.

Forward looking statements are based on a number of material factors and assumptions, including the results of exploration/development and drilling activities, the availability and final receipt of required approvals, licenses and permits, that sufficient working capital is available to complete proposed exploration/development and drilling activities, that contracted parties provide goods and/or services on the agreed time frames, the equipment necessary for exploration/development is available as scheduled and does not incur unforeseen break downs, that no labour shortages or delays are incurred and that no unusual geological or technical problems occur. While we consider these assumptions may be reasonable based on information currently available to it, they may prove to be incorrect. Actual results may vary from such forward-looking information for a variety of reasons, including but not limited to risks and uncertainties disclosed in the section titled “Risk Factors” in this Quarterly Report.

We intend to discuss in our Quarterly Reports and Annual Reports any events or circumstances that occurred during the period to which such documents relate that are reasonably likely to cause actual events or circumstances to differ materially from those disclosed in this Quarterly Report. New factors emerge from time to time, and it is not possible for management to predict all of such factors and to assess in advance the impact of each such factor on our business or the extent to which any factor, or combination of such factors, may cause actual results to differ materially from those contained in any forwarding looking statement.

CAUTIONARY NOTE TO U.S. INVESTORS REGARDING ESTIMATES OF MEASURED, INDICATED AND INFERRED RESOURCES AND PROVEN AND PROBABLE RESERVES

The terms “mineral reserve”, “proven mineral reserve” and “probable mineral reserve” as used in this Quarterly Report are Canadian mining terms as defined in accordance with Canadian National Instrument 43-101 – Standards of Disclosure for Mineral Projects (“NI 43-101”) and the Canadian Institute of Mining, Metallurgy and Petroleum (the “CIM”) – CIM Definition Standards on Mineral Resources and Mineral Reserves, adopted by the CIM Council, as amended (the “CIM Definition Standards”). These definitions differ from the definitions in the United States Securities and Exchange Commission (“SEC”) Industry Guide 7 (“SEC Industry Guide 7”) under the United States Securities Act of 1933, as amended (the “Securities Act”). Under SEC Industry Guide 7 standards, a “final” or “bankable” feasibility study is required to report reserves, the three-year historical average price is used in any reserve or cash flow analysis to designate reserves, and the primary environmental analysis or report must be filed with the appropriate governmental authority.

In addition, the terms “mineral resource”, “measured mineral resource”, “indicated mineral resource” and “inferred mineral resource” are defined in and required to be disclosed by NI 43-101; however, these terms are not defined terms under SEC Industry Guide 7 and are normally not permitted to be used in reports and registration statements filed with the SEC. Investors are cautioned not to assume that all or any part of a  mineral deposit in these categories will ever be converted into reserves. “Inferred mineral resources” have a great amount of uncertainty as to their existence, and great uncertainty as to their economic and legal feasibility. It cannot be assumed that all, or any part, of an inferred mineral resource will ever be upgraded to a higher category. Under Canadian rules, estimates of inferred mineral resources may not form the basis of feasibility or pre-feasibility studies, except in rare cases. Investors are cautioned not to assume that all or any part of an inferred mineral resource exists or is economically or legally mineable. Disclosure of unit measures in a resource is permitted disclosure under Canadian regulations; however, the SEC only permits issuers to report mineralization that does not constitute “reserves” by SEC standards as in place tonnage and grade without reference to unit measures.

16

Accordingly, information contained in this Quarterly Report and any documents incorporated by reference herein contain descriptions of our mineral deposits that may not be comparable to similar information made public by U.S. companies subject to the reporting and disclosure requirements under the United States federal securities laws and the rules and regulations thereunder.

As used in this Quarterly Report, unless the context otherwise requires, “we,” “us,” “our,” the “Company” and “I-Minerals” refers to I-Minerals Inc.  All dollar amounts in this Quarterly Report are in U.S. dollars unless otherwise stated.

PART I

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

General

We were incorporated under the laws of British Columbia, Canada in 1984. In 2004, we changed our corporate jurisdiction from a British Columbia company to a Canadian corporation.  In December 2011, we amended our articles to change our name from “i-minerals inc.” to “I-Minerals Inc.”

The Company is engaged in the exploration, evaluation and development of our Helmer-Bovill industrial minerals property (the “Helmer-Bovill Property”).  The Helmer-Bovill Property, in which we hold a 100% interest, is comprised of 11 mineral leases totaling 5,140.64 acres located approximately 6 miles northwest of Bovill, Latah County, Idaho.  Since inception, the Company has been in the exploration stage but moved into the development stage in fiscal 2018.  In fiscal 2019, the Company reverted back to the evaluation stage.

Our principal executive office is located at Suite 880, 580 Hornby Street, Vancouver, British Columbia, Canada and our telephone number is (877) 303-6573.  Our operations office is located at 13403 N. Government Way, #102, Hayden, Idaho.

To date, we have not earned significant revenues from the operation of our Helmer-Bovill Property.  Accordingly, we are dependent on debt and equity financing as our primary source of operating working capital.  Our capital resources are largely determined by the strength of the junior resource markets and by the status of our projects in relation to these markets, and its ability to compete for investor support of its projects.

Our Principal Projects

Our activities at the Helmer-Bovill Property are focused on developing the Bovill Project.

The Bovill Project

Our lead project, the Bovill Project, is a strategically located long term resource of quartz, potassium feldspar (“K-spar”), halloysite and kaolinite formed through weathering of a border phase of the Idaho Batholith causing all minerals to be contained within a fine white clay-sand mixture referred to as “primary clay.” The Bovill Project is located within 3 miles of state highways with electricity and natural gas already at the property boundary.

Since 2010, our exploration work has focused diamond drilling on the Bovill Project.  To date, a total of 322 diamond drill holes have been drilled totaling 35,909 feet.  As a result of these drill campaigns, four deposits have been identified: Kelly’s Hump, Kelly’s Hump South, Middle Ridge and WBL.

In June 2014, we completed an updated pre-feasibility study on the Bovill Kaolin Project (the “2014 PFS”) and on March 8, 2016, we announced the economic results of our initial feasibility study (the “2016 FS”).  However, based on the results of an updated independent market study it is apparent that fundamental changes in the businesses that consume our minerals has taken place over the past several years.  These changes include offshoring and reformulation wherein industries that had previously used K-spar for example have reformulated their production batches using alternate minerals.  Markets do exist for all of the minerals contained within the Bovill Kaolin Project but not in the volumes contemplated in the 2016 FS.  Accordingly, the 2016 FS is considered not to be current and should not be relied upon.

17

The mineral resources stated in the 2016 FS remain current and have recently been re-stated in a standalone technical report prepared by SRK Consulting (U.S.) recently completed an updated resource estimate.  The updated mineral resource statement from this report, summarized below, contains the same tonnages and grades as were disclosed in the 2016 FS and is the basis of the reserves defined in the 2020 Pre-Feasibility Report.

2020 Pre-Feasibility Study

The Company engaged MillCreek Engineering of Salt Lake City, Utah to estimate the capital and operating costs for a smaller plant capable of producing up to 20,000 tons of metakaolin and 10,000 tons of halloysite per year.  The estimated Operating Costs and Capital Cost fell in line with expectations and the Company retained MillCreek to complete a Pre-Feasibility Study of a metakaolin and halloysite operation.  It is envisioned that the sand fraction (K-spar and quartz) will be screened and sold into lower value industrial applications. 

On March 3, 2020, we announced a pre-feasibility study of our metakaolin and halloysite operation (the “2020 PFS”).  The 2020 PFS was led by Millcreek Engineering, who were responsible for overall project management and the process plant and infrastructure design (including OPEX and CAPEX) and economic analyses.  Other engineering and geological services were provided by Mine Development Associates (mine modelling; ore scheduling; mineral reserve estimation); SRK Consulting (U.S.) Inc. (mineral resource estimation); and, HDR Engineering Inc. (environmental review).

Highlights of the PFS include:

• 20% Pre-Tax IRR; 18% After Tax IRR
• US$48.3 million Pre-Tax NPV; US$33.7 million After Tax NPV
• Initial Capital Cost of US$48.3 million
• Total Life of Operation Capital Costs of US$54.2 million
• 25 year mine life with 1.04:1 strip ratio

The 2020 PFS is based on the production of two minerals, halloysite and kaolinite. The halloysite is beneficiated into two mineral products; HalloPure which is about 70% halloysite and 30% kaolinite and premium quality Ultra-Hallopure which is greater than 90% halloysite with the balance kaolinite. The quality of Bovill Halloysite is regarded as being exceptional and the research on halloysite applications has dramatically increased over the past 5 years involving polymers, filtration, extruded polystyrene insulation, green technology and life sciences. The kaolinite is flash calcined to produce metakaolin, a Supplementary Cementitious Material (“SCM”) and highly reactive pozzolan that when added to concrete increases strength and durability, reduces permeability, reduces the effect of alkali-silica reactivity and increases resistance to chloride ingress and sulfate attack. By using metakaolin the sustainability of the concrete is increased through longer service life and the carbon footprint is reduced by lowering the quantity of Portland cement. Sand is produced during the production process which meets the specifications of a number of applications including arena sand, USGA bunker and top-dressing sand. There is a potential upside from sale of sand which is not included in the project economics and accordingly the sand is not included in the reserves. 

A conservative approach to the build-up of sales has been assumed with full production being achieved in the first quarter of the 5^th year of operation as some product applications will require development. There is potential for full production to be achieved earlier which would have a corresponding positive effect on the NPV and IRR. 

Updated Measured and Indicated Resource Estimate

• Measured Resources of 5.7 million tons containing 76.5% quartz/K-spar sand, 12.3% Kaolinite and 4.0% Halloysite.
• Indicated Resources of 15.5 million tons containing 57.0% quartz/K-spar sand, 15.5% Kaolinite and 2.8% Halloysite.
• 667,000 tons of contained halloysite, 3,119,000 tons of contained kaolinite and 13,235,000 tons of contained quartz/K-spar.

18

Updated Mineral Reserves

	Proven	Probable	Total P&P
K Tons	1,310	1,868	3,178
Halloysite %	8.8	8.0	8.3
Halloysite K Tons	115	149	264
Kaolinite %	11.1	22.4	17.7
Kaolinite K Tons	145	418	563
NSR	$             109	$                123	$                   117

* Notes on Mineral Reserves:

• Reserves are based on a $40.00 NSR cutoff grade and pit designs.
• Rounding of numbers in mineral reserves listed above may cause apparent inconsistencies.
• The reference point for Mineral Reserves is at the plant stockpile

The full 2020 PFS was filed on www.sedar.com on April 16, 2020 and is available on the Company’s website. 

Plan of Operation and Outlook

The company is taking a sequential approach to the development of the Bovill Project.  The first phase is the amendment of our Operations and Reclamation Plan (“ORP”) with the Idaho Department of Lands (the “IDL”).  With the changes to the business plan, now focusing on the production of halloysite and metakaolin, the mine plan was developed based on areas with increased concentrations of halloysite and kaolin.  This resulted in a reconfiguration of the open pits where these minerals are proposed to be mined.  As a result of the reconfiguration of the open pits, the areas of disturbance and road design to service the mining operations has changed, triggering the need to amend the previously approved ORP.  In general, the disturbed area is smaller than the disturbed area in the prior ORP.  The amended ORP was submitted to the IDL on August 28, 2020.

Concurrent with the updating of the ORP, the development of a market for sand is ongoing.  Target markets include bunker sand and top dressing for golf courses, equestrian sand and other applications.  Market development for the halloysite is ongoing with global interest in our products continuing to develop with strong interest being shown by several South Korean companies.  Treated halloysite is also being tested in air filtration activities as an environmentally friendly alternative to activated charcoal.

Upon approval of the ORP, we intend to initiate a Feasibility Study (“FS”) and Front End Engineering Design Study (“FEED Study”).  The amended ORP was submitted to the IDL on August 28, 2020.  The company received initial comments from the IDL on October 21, 2020 and responded to such comments on November 6, 2020.  Based upon the feedback from the various consultants working on the ORP, we expect to commence the FS and FEED Study in January 2021.

Results of Operation

Six months ended October 31, 2020

We recorded a net loss of $2,387,696 ($0.03 per share) for the six months ended October 31, 2020 as compared to a net loss of $2,624,163 ($0.03 per share) for the six months ended October 31, 2019.  The decrease in the net loss recorded for the six months ended October 31, 2020 as compared to the net loss for the six months ended October 31, 2019 is the net result of changes to a number of expenses.  Of note are the following items:

• Management and consulting fees of $100,524 (2019 - $101,513) are comprised of fees to manage our Company and stock-based compensation.  Approximately 75% of the fees to manage our Company are charged to management and consulting fees and the other 25% is charged to mineral property expenditures.
• Mineral property expenditures of $298,461 (2019 - $724,205) are costs incurred on our Helmer-Bovill Property.  The expenditures in the current period are pre-development costs that have been expensed during the period.  The main components of costs during the current period included engineering and consulting ($85,906) and metallurgy ($97,416).  During the current period, the Company continued to optimize the metallurgical processes and detailed engineering.  Effective January 31, 2019, the Company returned to the evaluation stage for accounting purposes and therefore stopped capitalizing development costs.

19

• General and miscellaneous expenses of $88,670 (2019 - $136,811) are comprised of office and telephone expenses, payroll taxes, medical benefits, insurance premiums, travel expenses, promotional expenses, shareholder communication fees, transfer agent fees and filing fees.  The decrease during the current period was due primarily to a reduction in shareholder communications fees and travel expenses.
• Professional fees of $97,451 (2019 - $111,398) include legal fees, audit fees and financial consulting fees.
• Accretion expense of $nil (2019 - $60,348) was the amortization of the fair value of bonus shares and bonus warrants issued to the Lender of the promissory notes.  The amounts were fully amortized in fiscal 2020.
• Interest expense of $1,803,653 (2019 - $1,488,711) is from promissory notes that bear interest at the rates of 12%-14% per year.  Interest increased as additional funds were advanced.
• We recorded a gain on change in fair value of derivative liabilities of in fiscal 2019 of $3,143.  The change in fair value of derivative liabilities was based on the change in remaining term of derivative instruments and our stock price.  The derivatives included stock options granted to non-employees.  The derivative liabilities did not represent cash liabilities.  On May 1, 2020, we adopted ASU 2018-07 which eliminated the derivative liabilities against opening deficit.

Liquidity and Capital Resources

Our aggregate operating, investing and financing activities during the six months ended October 31, 2020 resulted in a net cash outflow of $294,846 (2019 – outflow of $207,615).  As at October 31, 2020, we had a working capital deficiency of $31,367,788.  

During the six months ended October 31, 2020, $543,967 was used in operations (2019 - $880,004).  During the six months ended October 31, 2020, we spent $879 on investing activities (2019 - $7,611) and we received $250,000 from financing activities (2019 - $680,000).

We have been financed by advances pursuant to promissory notes advanced by BV Lending LLC, an entity controlled by Allen L. Ball, a member of our Board of Directors and our largest shareholder (the “Lender”).  During the six months ended October 31, 2020, the Company was receiving advances pursuant to the Sixth Promissory Notes.  As at October 31, 2020, the balance of the promissory notes was $29,514,334.  On November 5, 2020, we received $100,000 of advances and on December 3, 2020, we received $200,000 of advances.

As at April 30, 2020, the Third Promissory Notes, the Fifth Promissory Notes and the Sixth Promissory Notes had a maturity date of the earlier of (i) June 30, 2020 and (ii) 60 days after a pre-feasibility study has been filed on SEDAR. On June 4, 2020, the promissory notes maturity date was extended from June 30, 2020 to December 15, 2020 for no consideration.  All other terms remained the same.  On December 3, 2020, the Lender agreed to extend the maturity date of the promissory notes to March 15, 2021 for no consideration.

We have not as yet put into commercial production any mineral properties and as such have no operating revenues.  Accordingly, we are dependent on debt and equity financing as its primary source of operating working capital.  Our capital resources are largely determined by the strength of the junior resource markets and by the status of our projects in relation to these markets, and our ability to compete for investor support of our projects.

We remain dependent on additional financing to fund development requirements on the Helmer-Bovill property and for general corporate costs.  With respect to funds required for capital cost items, State-sponsored debt financing instruments may be available on attractive terms, and we intend to pursue such financial instruments to cover portions of the capital costs associated with placing the Bovill Project deposits into production. 

We do not have the ability to internally generate sufficient cash flows to support our operations for the next twelve months.  We have been receiving funds from a company controlled by a director of the Company through promissory notes.  We have no formal plan in place to address this going concern issue but consider that we will be able to obtain additional funds by equity financing and/or debt financing; however, there is no assurance of additional funding being available. 

During 2020, there was an outbreak of COVID-19 that has impacted the economic environment and the capital markets.  As the Company is at the stage of exploration and evaluation and is looking to fund mine development leading to production, the impacts of COVID-19 are not determinable at this date.  COVID-19 however, could have a material impact on the Company's financial position, results of operation and cash flows. The Company's liquidity and its ability to continue as a going concern may also be impacted.

20

Off-Balance Sheet Arrangements

We have no significant off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that is material to shareholders.

Critical Accounting Policies

Measurement Uncertainty

The preparation of these consolidated financial statements in conformity with US GAAP requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period.  We regularly evaluate estimates and assumptions related to the useful life and recoverability of long lived assets, stock-based compensation, valuation of convertible debentures and derivative liabilities, and deferred income tax asset valuation allowances.  We base our estimates and assumptions on current facts, historical experience and various other factors that it believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the accrual of costs and expenses that are not readily apparent from other sources.  The actual results experienced by us may differ materially and adversely from our estimates.  To the extent there are material differences between the estimates and the actual results, future results of operations will be affected.  The most significant estimates with regard to our condensed consolidated financial statements relate to the determination of fair values of derivative liabilities and stock-based transactions.

Mineral Property Acquisition and Exploration Costs

Mineral property acquisition costs are capitalized when incurred.  Acquisition costs include cash consideration and the fair market value of shares issued on the acquisition of mineral property claims.

Costs related to the development of our mineral reserves are capitalized when it has been determined an ore body can be economically developed.  The development stage begins when an ore body is determined to be economically recoverable based on proven and probable reserves and appropriate permits are in place, and ends when the production stage or exploitation of reserves begins.  Major mine development expenditures are capitalized, including primary development costs such as costs of building access ways, tailings impoundment, development of water supply and infrastructure developments.

Exploration costs include those relating to activities carried out (a) in search of previously unidentified mineral deposits, or (b) at undeveloped concessions.  Pre-development activities involve costs incurred in the exploration stage that may ultimately benefit production that are expensed due to the lack of evidence of economic development, which is necessary to demonstrate future recoverability of these expenses.  Secondary development costs are incurred for preparation of an ore body for production in a specific ore block or work area, providing a relatively short-lived benefit only to the mine area they relate to, and not to the ore body as a whole.

Once production has commenced, capitalized costs will be depleted using the units-of-production method over the estimated life of the proven and probable reserves. If mineral properties are subsequently abandoned or impaired, any capitalized costs will be charged to the Consolidated Statements of Loss in that period.

We assess the carrying cost of our mineral properties for impairment whenever information or circumstances indicate the potential for impairment.  Such evaluations compare estimated future net cash flows with our carrying costs and future obligations on an undiscounted basis.  If it is determined that the future undiscounted cash flows are less than the carrying value of the property, a write down to the estimated fair value is charged to the Consolidated Statements of Loss for the period.  Where estimates of future net cash flows are not available and where other conditions suggest impairment, management assesses if the carrying value can be recovered.

For significant exploration and development projects, interest is capitalized as part of the historical cost of developing and constructing assets in accordance with ASC 835-20. Interest is capitalized until the asset is ready for service. Capitalized interest is determined by multiplying the Company’s weighted-average borrowing cost on general debt by the average amount of qualifying costs incurred. Once an asset subject to interest capitalization is completed and placed in service, the associated capitalized interest is expensed through depletion or impairment.

21

Item 3. Quantitative and Qualitative Disclosures About Market Risk.

Not applicable

Item 4. Controls and Procedures.

The Company’s management, with the participation of the Company’s Chief Executive Officer and Chief Financial Officer, has evaluated the effectiveness of the Company’s disclosure controls and procedures as of October 31, 2020. Based on that evaluation, the Company’s Chief Executive Officer and Chief Financial Officer concluded that the Company’s disclosure controls and procedures were effective as of October 31, 2020.  There were no material changes in the Company’s internal control over financial reporting during the second quarter of fiscal 2021.

PART II

Item 1. Legal Proceedings.

None.

Item 1A. Risk Factors.

There have been no material changes from the risk factors as previously disclosed in our Annual Report on Form 10-K which was filed with the SEC on July 28, 2020. 

Item 2. Sale of Unregistered Securities.

None.

Item 3. Defaults Upon Senior Securities.

None.

Item 4. Mine Safety Disclosures.

Pursuant to Section 1503(a) of the Dodd-Frank Wall Street Reform and Consumer Protection Act (The “Dodd-Frank Act”), issuers that are operators, or that have a subsidiary that is an operator, of a coal or other mine in the United States are required to disclose in their periodic reports filed with the SEC information regarding specified health and safety violations, orders and citations, related assessments and legal actions, and mining-related fatalities. During the six months ended October 31, 2020, our U.S. exploration and evaluation property was not subject to regulation by the Federal Mine Safety and Health Administration (“MSHA”) under the Federal Mine Safety and Health Act of 1977 (the "Mine Act").

Item 5. Other Information.

None.

22

Item 6. Exhibits

3.1	Certificate of Continuation.(2)
3.2	Articles of Continuance.(2)
3.3	Certificate of Amendment.(2)
3.4	Articles of Amendment.(2)
3.5	By-Laws.(2)
10.1	Assignment Agreement with Contingent Right of Reverter dated August 10, 2002, between the Company, Idaho Industrial Minerals, LLC and Northwest Kaolin Inc.(2)
10.2	Amendment and Ratifications of Assignment Agreement with Contingent Right of Reverter dated August 10, 2005, between the Company, Idaho Industrial Minerals, LLC and Northwest Kaolin Inc.(2)
10.3	Second Amendment and Ratifications of Assignment Agreement with Contingent Right of Reverter dated August 10, 2005, between the Company, Idaho Industrial Minerals, LLC and Northwest Kaolin Inc.(2)
10.4	Third Amendment and Ratifications of Assignment Agreement with Contingent Right of Reverter dated August 10, 2008, between the Company, Idaho Industrial Minerals, LLC and Northwest Kaolin Inc.(2)
10.5	Fourth Amendment and Ratifications of Assignment Agreement with Contingent Right of Reverter dated January 1, 2010, between the Company, Idaho Industrial Minerals, LLC and Northwest Kaolin Inc.(2)
10.6	Employment Agreement dated April 1, 2013 between the Company and Thomas M. Conway.(2)
10.7	Loan Agreement dated September 13, 2013 between the Company and BV Lending LLC.(2)
10.8	Stock Option Plan.(1)
10.9	Sales Agreement dated April 28, 2014 between I-Minerals USA, Inc. and Pre-Mix, Inc.(2)
10.10	Loan Agreement dated February 18, 2015 between the Company and BV Lending LLC.(3)
10.11	Amendment Agreement dated December 1, 2015 between the Company and BV Lending LLC.(4)
10.12	Loan Agreement dated June 1, 2016 between the Company and BV Lending LLC. (5)
10.13	Amending Agreement dated October 25, 2017 between the Company and BV Lending LLC. (6)
10.14	Amending Agreement dated January 18, 2018 between the Company and BV Lending LLC. (7)
10.15	Amending Agreement dated March 30, 2018 between the Company and BV Lending LLC. (8)
10.16	Employment Agreement dated March 1, 2018 between the Company and John Theobald. (9)
10.17	Settlement Agreement dated August 3, 2018 between the Company and Thomas Conway. (9)
10.18	Loan Agreement dated September 11, 2018 between the Company and BV Lending LLC. (9)
10.19	Amending Agreement dated March 27, 2019 between the Company and BV Lending LLC
10.20	Amending Agreement dated June 28, 2019 between the Company and BV Lending LLC
10.21	Loan Agreement dated October 25, 2019 between the Company and BV Lending LLC. (11)
10.22	Amending Agreement dated October 25, 2019 between the Company and BV Lending LLC. (12)
10.23	Amending Agreement dated November 25, 2019 between the Company and BV Lending LLC. (12)
10.24	Amending Agreement dated January 20, 2020 between the Company and BV Lending LLC. (13)
10.25	Amending Agreements dated June 4, 2020 between the Company and BV Lending LLC. (14)
10.26	Amending Agreement dated July 8, 2020 between the Company and BV Lending LLC. (14)
10.27	Amending Agreements dated December 3, 2020 between the Company and BV Lending LLC.
31.1	Certification of Chief Executive Officer pursuant to Section 302 of Sarbanes-Oxley Act of 2002 (Rule 13a-14 and 15d-14 of the Exchange Act)
31.2	Certification of Chief Financial Officer pursuant to Section 302 of Sarbanes-Oxley Act of 2002 (Rule 13a-14 and 15d-14 of the Exchange Act)
32.1	Certification of Chief Executive Officer pursuant to pursuant to Section 1350 of Title 18 of the United States Code
32.2	Certification of Chief Financial Officer pursuant to pursuant to Section 1350 of Title 18 of the United States Code

Notes:

(1) Filed as an exhibit to our Registration Statement on Form 10 filed with the SEC on November 17, 2014.

(2) Filed as an exhibit to our Registration Statement on Form 10/A filed with the SEC on December 24, 2014.

(3) Filed as an exhibit to our Current Report on Form 8-K filed with the SEC on March 11, 2015.

(4) Filed as an exhibit to our Current Report on Form 8-K filed with the SEC on December 7, 2015.

(5) Filed as an exhibit to our Form 10-Q filed with the SEC on September 14, 2016.

(6) Filed as an exhibit to our Form 10-Q filed with the SEC on December 15, 2017.

(7) Filed as an exhibit to our Form 10-Q filed with the SEC on March 14, 2018.

(8) Filed as an exhibit to our Form 10-K filed with the SEC on August 3, 2018.

(9) Filed as an exhibit to our Form 10-Q filed with the SEC on September 14, 2018.

(10) Filed as an exhibit to our Form 10-K filed with the SEC on July 29, 2019.

(11) Filed as an exhibit to our Current Report on Form 8-K filed with the SEC on November 8, 2019.

(12) Filed as an exhibit to our Form 10-Q filed with the SEC on December 16, 2019.

(13) Filed as an exhibit to our Form 10-Q filed with the SEC on March 13, 2020.

(14) Filed as an exhibit to our Form 10-K filed with the SEC on July 28, 2020.

23

SIGNATURES

In accordance with Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

			I-MINERALS INC.
Date:	December 11, 2020	By:	/s/ John Theobald
			JOHN THEOBALD
			Chief Executive Officer and President
			(Principal Executive Officer)
Date:	December 11, 2020	By:	/s/ Matthew Anderson
			MATTHEW ANDERSON
			Chief Financial Officer
			(Principal Financial Officer and Principal Accounting Officer)

EX-10.27

THIS FIFTH AMENDING AGREEMENT is made as of December 3, 2020.

AMONG:

I-Minerals Inc., a body corporate, continued under the laws of

Canada, having its head office at Suite 880 — 580 Hornby Street, Vancouver, British Columbia, Canada V6C 3B6

(hereinafter called the "Company")

OF THE FIRST PART

AND:

i-minerals USA Inc., an Idaho limited liability company, having an office c/o the Company, at Suite 880 — 580 Hornby Street, Vancouver, British Columbia, Canada V6C 3B6

(hereinafter called the "Subsidiary")

OF THE SECOND PART

AND:

BV Lending, LLC, an Idaho limited liability company, having its head office at Suite 300, 2194 Snake River Parkway, Idaho Falls, Idaho, U.S.A. 83402

(hereinafter called "BV")

OF THE THIRD PART

WHEREAS:

A. Pursuant to an agreement among the parties dated October 25, 2019, as amended by an amending agreement dated November 25, 2019 (hereinafter called the “First Amending Agreement”), as amended by an amending agreement dated January 20, 2020 (hereinafter called the “Second Amending Agreement”), as amended by an amending agreement dated June 4, 2020 (hereinafter called the “Third Amending Agreement”), as amended by an amending agreement dated July 8, 2020 (hereinafter called the “Fourth Amending Agreement”), with the agreement dated October 25, 2019, as amended by the First Amending Agreement, the Second Amending Agreement, the Third Amending Agreement, and the Fourth Amending Agreement hereinafter collectively called the “Loan Agreement”, B.V. agreed to advance certain funds to the Company to advance its Bovill Kaolin Project located in the State of Idaho, U.S.A.;

B. The parties wish to further amend certain of the provisions of the Loan Agreement on the terms and conditions hereinafter set forth;

C. The Subsidiary is a wholly-owned subsidiary of the Company and is the legal owner of the Helmer Bovill Property hosting the Bovill Kaolin Project in the State of Idaho, U.S.A., as referred to in Recital A. herein;

NOW THEREFORE THIS FIFTH AMENDING AGREEMENT WITNESSETH that in consideration of these presents and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged by each of the parties, the parties hereby agree as follows:

2

1. The parties agree that the Loan Agreement is hereby amended as follows.

Paragraph 6.01 is replaced in its entirety with the following:

“6.01   The parties agree that the Company will repay the Indebtedness on March 15, 2021.”

2. Except as amended by this Fifth Amending Agreement, all of the other terms and conditions of the Loan Agreement remain in full force and effect.

3. Each of the parties agrees to do and/or execute all such further and other acts, deeds, things, devices, documents and assurances that may be required in order to carry out the true intent and meaning of this Fifth Amending Agreement.

4. This Fifth Amending Agreement and any certificate or other writing delivered in connection herewith may be executed in any number of counterparts and any party hereto may execute any counterpart, each of which when executed and delivered will be deemed to be an original and all of which counterparts of this Fifth Amending Agreement or such other writing, as the case may be, taken together, will be deemed to be one and the same instrument. The execution of this Fifth Amending Agreement or any other writing by any party hereto will not become effective until each party hereto has executed a counterpart of this Fifth Amending Agreement or any other writing, as the case may be.

5. Each of the parties hereto will be entitled to rely upon delivery by facsimile or by email of executed copies of this Fifth Amending Agreement and any certificates or other writings delivered in connection herewith, and such facsimile or emailed copies will be legally effective to create a valid and binding agreement among the parties in accordance with the terms and conditions of this Fifth Amending Agreement.

6. This Fifth Amending Agreement shall enure to the benefit of and be binding upon the parties hereto and each of their successors and permitted assigns, as the case may be.

IN WITNESS WHEREOF the parties have executed and delivered this Fifth Amending Agreement as of the day and year first above written.

3

Executed by
I-Minerals Inc.
in the presence of:

Signed “John Theobald”                                            

Authorized Signatory

Executed by

i-minerals USA Inc.

in the presence of:

Signed “John Theobald”                                            

Authorized Signatory

Executed by

BV Lending, LLC

By:       Ball Ventures, LLC, an Idaho limited
             liability company, the Member

By:       BV Management Services, Inc., an Idaho

             corporation, the Manager

            Per:  Signed “Cortney Liddiard”                

                    Cortney Liddiard, President

DATED:            December 3, 2020

Between:

I-Minerals Inc.

OF THE FIRST PART

And:

i-minerals USA Inc.

OF THE SECOND PART

And:

BV Lending, LLC

OF THE THIRD PART

FIFTH AMENDING AGREEMENT

Tupper Jonsson & Yeadon
1710 - 1177 West Hastings Street
Vancouver, B. C.
V6E 2L3

Telephone: (604) 640-6355

THIS AGREEMENT is dated December 3, 2020.

BETWEEN:

I-Minerals Inc., a body corporate, continued under the laws of Canada, having its head office at Suite 880 – 580 Hornby Street, Vancouver, British Columbia, Canada V6C 3B6

(hereinafter called the “Company”)

OF THE FIRST PART

AND:

BV Lending, LLC, an Idaho limited liability company, having its head office at Suite 300, 2194 Snake River Parkway, Idaho Falls, Idaho, U.S.A. 83402

(hereinafter called “BV”)

OF THE SECOND PART

WHEREAS:

A. Pursuant to an agreement among the parties dated June l, 2016, as amended by an amending agreement dated October 25, 2017 (hereinafter called the "First Amending Agreement"), as further amended by an amending agreement dated January 19, 2018 (hereinafter called the "Second Amending Agreement"), as further amended by an amending agreement dated March 20, 2018 (hereinafter called the “Third Amending Agreement”), as further amended by an amending agreement dated March 27, 2019 (hereinafter called the “Fourth Amending Agreement”), as further amended by an amending agreement dated June 28, 2019 (hereinafter called the “Fifth Amending Agreement”), with the loan agreement dated June 1, 2016, as amended by the First Amending Agreement, the Second Amending Agreement, the Third Amending Agreement, the Fourth Amending Agreement and the Fifth Amending Agreement hereinafter collectively called the "Loan Agreement", BV agreed to advance certain funds to the Company to advance its Bovill Kaolin Project located in the State of Idaho, U.S.A.;

B. Pursuant to an agreement among the parties dated September 11, 2018 (hereinafter called the “2018 Loan Agreement”), BV agreed to advance an additional $2,500,000 to the Company to further advance its Bovill Kaolin Project located in the State of Idaho, U.S.A.;

C. The Loan Agreement and the 2018 Loan Agreement are hereinafter collectively referred to as the “Loan Agreements”;

D. The Loan Agreements were previously amended by an amending agreement dated October 25, 2019;

E. Pursuant to paragraph 1.01 of an agreement between the Company and BV dated June 4, 2020, the date for the repayment of all cash advances made pursuant to the Loan Agreements, together with all accrued and unpaid interest thereon, was extended until December 15, 2020;

2

F. The parties have agreed to further extend the repayment date by which the principal and interest outstanding pursuant to the Loan Agreements is to be made, as provided for herein;

NOW THEREFORE THIS AGREEMENT WITNESSETH that in consideration of these presents and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged by each of the parties, the parties hereby agree as follows:

1. Extension for the repayment of the Indebtedness

1.01 Notwithstanding the provisions for the repayment of the cash advances made pursuant to the Loan Agreements, together with all accrued and unpaid interest thereon, as provided for in the Loan Agreements and pursuant to certain related promissory notes issued pursuant to the Loan Agreements, the date for the repayment of all cash advances made pursuant to the Loan Agreements, together with all accrued and unpaid interest thereon, is hereby extended until March 15, 2021.

2. Notices

2.01 All notices, payments and other communications given in connection with this Agreement shall be in writing, and the respective addresses of the parties for the service of any notice, payment or other communication shall be as follows:

(a) if to the Company:

I-Minerals Inc.
Suite 880 – 580 Hornby Street
Vancouver, British Columbia, Canada
V6C 3B6

Attention:  Barry Girling, Director
Email: wbg@imineralsinc.com

(b) if to BV:

BV Lending, LLC

P.O. Box 51298
Idaho Falls, ID 83405

2194 Snake River Parkway
Suite 300
Idaho Falls, ID 83402

Attention:  Cortney Liddiard, Chief Executive Officer
Email: flyfish@ballventures.com

3

with a copy to:

Thel W. Casper, Esq.
General Counsel to Ball Ventures, LLC

P.O. Box 51298
Idaho Falls, ID 83405

2194 Snake River Parkway
Suite 300
Idaho Falls, ID 83402

Email: tcasper@ballventures.com

Any notice, payment or other communication shall be sufficiently given if delivered by email or by hand or by reputable courier service, or, absent postal disruption, if sent by registered mail, postage prepaid, posted within either Canada or the United States of America, to the parties at their respective addresses for service as set forth above.  Any notice, payment or other communication shall be deemed to have been given and received on the first business day on which it is presented during normal business hours at the address for service of the addressee.  Any party may change its address for service by notice in writing to the other parties.

3. Time of the Essence

3.01 Time shall be of the essence of this Agreement.

4. U.S. Dollars

4.01 All references herein to dollar amounts are to lawful currency of the United States of America, unless otherwise specifically provided for herein.

5. Headings

5.01 The headings contained herein are for convenience only and shall not affect the meaning or interpretation hereof.

6. Singular and Plural, etc.

6.01 Where the context so requires, words importing the singular number include the plural and vice versa, and words importing gender shall include the masculine, feminine and neuter genders.

7. Entire Agreement

7.01 This Agreement constitutes the only agreement among the parties with respect to the subject matter hereof and shall supersede any and all prior negotiations and understandings. This Agreement may be amended or modified in any respect by written instrument only.

4

8. Severability

8.01 The invalidity or unenforceability of any particular provision of this Agreement shall not effect or limit the validity or enforceability of the remaining provisions of this Agreement.

9. Governing Law

9.01 This Agreement shall be governed by and construed in accordance with the laws of the Province of British Columbia and the laws of Canada applicable therein. The parties irrevocably attorn to the jurisdiction of the courts of British Columbia, which will have non-exclusive jurisdiction over any matter arising out of this Agreement.

10. Dispute Resolution

10.01 If any dispute arises between any of the Parties (the Parties in dispute being the “Participants”) concerning this Agreement or its interpretation or the respective rights, duties or liabilities of the Parties, then a Participant may give to the other Participants notice in writing of the existence of such dispute, specifying its nature and the point at issue and the Participants agree:

(a) to try to resolve the dispute by participating in a structured negotiation with a mediator under the Commercial Mediation Rules of British Columbia International Commercial Arbitration Centre (“BCICAC”);

(b) where a dispute is not resolved by mediation within a period of 30 days after the appointment of a mediator or within such further period of time to which the Participants agree, any Participant may refer the dispute to be finally resolved by arbitration under the BCICAC Rules. The appointing authority will be the BCICAC, the case shall be administered by the BCICAC in accordance with its “Procedures for Cases under the BCICAC Rules” and the place of arbitration shall be Vancouver, British Columbia. The appointment by the BCICAC is binding upon all of the Participants;

(c) the arbitrator will give his decision in writing within three weeks of his being appointed and the decision, both on the dispute and on the costs of the arbitration will be final and binding upon the Participants;

(d) the arbitrator will have full authority to rule on any question of law in the same manner as any Judge in any Court of the Province of British Columbia and the ruling of the arbitrator on any question of law will be final and binding upon the Participants; and

(e) the failure of any Participant to abide by the decision of the arbitrator is considered a material breach of this Agreement.

5

This paragraph shall survive any termination of this Agreement and continues in full force and effect notwithstanding any determination by a court or the Parties that one or more other provisions of this Agreement are invalid, contrary to law or unenforceable.

6

11. Successors and Assigns

11.01 The terms and provisions of this Agreement shall be binding upon and enure to the benefit of each of the parties and their respective successors and permitted assigns; provided that this Agreement shall not be assignable by any party without the written consent of each of the other parties hereto.

12. Further Assurances

12.01 Each of the parties hereto shall do or cause to be done all such acts and things and execute or cause to be executed all such documents, agreements and other instruments as may reasonably be necessary or desirable for the purpose of carrying out the provisions and intent of this Agreement.

13. Effective Date

13.01 This Agreement is intended to and shall take effect as of the date first set forth above, notwithstanding its actual date of execution or delivery.

14. Counterparts and Facsimile

14.01 This Agreement may be executed in any number of counterparts by original, facsimile or other form of electronic signature, each of which so executed shall constitute an original and all of which taken together shall form one and the same agreement.

IN WITNESS WHEREOF the parties have executed and delivered this Agreement as of the day and year first above written.

Executed by

I-Minerals Inc.

in the presence of:

Signed “John Theobald”                               

Authorized Signatory

Executed by

BV Lending, LLC

By:      Ball Ventures, LLC, an Idaho limited          
            liability company, the Member

By:      BV Management Services, Inc., an
            Idaho corporation, the Manager

             Per:      Signed “Cortney Liddiard”   

                        Cortney Liddiard, President

DATED:            December 3, 2020

Between:

I-Minerals Inc.

OF THE FIRST PART

And:

BV Lending, LLC

OF THE SECOND PART

FIFTH AMENDING AGREEMENT

Tupper Jonsson & Yeadon
1710 - 1177 West Hastings Street
Vancouver, B. C.
V6E 2L3

Telephone: (604) 640-6355

EX-31.1

Exhibit 31.1

CERTIFICATION

I, John Theobald, certify that:

1. I have reviewed this quarterly report on Form 10-Q of I-Minerals Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(c) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: December 11, 2020

/s/ John Theobald
JOHN THEOBALD
Chief Executive Officer and President

EX-31.2

Exhibit 31.2

CERTIFICATION

I, Matthew Anderson, certify that:

1. I have reviewed this quarterly report on Form 10-Q of I-Minerals Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(c) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: December 11, 2020

/s/ Matthew Anderson
MATTHEW ANDERSON
Chief Financial Officer

EX-32.1

Exhibit 32.1

CERTIFICATION BY CHIEF EXECUTIVE OFFICER

PURSUANT TO 18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES‑OXLEY ACT OF 2002

In connection with the Quarterly Report of I-Minerals Inc. (the “Company”) on Form 10-Q for the period ended October 31, 2020 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, John Theobald, Chief Executive Officer and President of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes‑Oxley Act of 2002, that:

1. The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: December 11, 2020

/s/ John Theobald
JOHN THEOBALD
Chief Executive Officer and President

EX-32.2

Exhibit 32.2

CERTIFICATION BY CHIEF EXECUTIVE OFFICER

PURSUANT TO 18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES‑OXLEY ACT OF 2002

In connection with the Quarterly Report of I-Minerals Inc. (the “Company”) on Form 10-Q for the period ended October 31, 2020 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Matthew Anderson, Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes‑Oxley Act of 2002, that:

1. The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: December 11, 2020

/s/ Matthew Anderson
MATTHEW ANDERSON
Chief Financial Officer

XML

Cover - shares	6 Months Ended
	Oct. 31, 2020	Dec. 14, 2020
Cover [Abstract]
Document Type	10-Q
Amendment Flag	false
Document Quarterly Report	true
Document Period End Date	Oct. 31, 2020
Document Fiscal Period Focus	Q2
Document Fiscal Year Focus	2021
Current Fiscal Year End Date	--04-30
Entity File Number	000-55321
Entity Registrant Name	I-Minerals Inc
Entity Central Index Key	0001405663
Entity Tax Identification Number	20-4644299
Entity Incorporation, State or Country Code	A1
Entity Address, Address Line One	Suite 880, 580 Hornby Street
Entity Address, City or Town	Vancouver
Entity Address, State or Province	BC
Entity Address, Country	CA
Entity Address, Postal Zip Code	V6C 3B6
City Area Code	604
Local Phone Number	303-6573
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Non-accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	true
Elected Not To Use the Extended Transition Period	true
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		93,730,212

XML

Condensed Interim Consolidated Balance Sheets (Unaudited) - USD ($)	Oct. 31, 2020	Apr. 30, 2020
Current assets
Cash	$ 53,041	$ 347,887
Receivables	5,373	9,184
Prepaids	20,776	18,816
Current Assets	79,190	375,887
Equipment and right-of-use asset	59,194	14,860
Mineral property interest and deferred development costs	1,892,410	1,892,410
Deposits	29,208	29,208
TOTAL ASSETS	2,060,002	2,312,365
Current liabilities
Accounts payable and accrued liabilities	1,904,662	1,743,094
Lease liability - current	27,982
Promissory notes due to related party	29,514,334	27,589,617
Derivative liabilities		16,541
Current Liabilities	31,446,978	29,349,252
Lease liability - non-current	21,066
TOTAL LIABILITIES	31,468,044	29,349,252
CAPITAL DEFICIT
Unlimited common shares with no par value, Issued and fully paid: 93,730,212 (April 30, 2020 - 93,730,212)	19,225,087	19,225,087
Additional paid-in capital	1,865,342	1,865,342
Deficit	(50,498,471)	(48,127,316)
TOTAL CAPITAL DEFICIT	(29,408,042)	(27,036,887)
TOTAL LIABILITIES AND CAPITAL DEFICIT	$ 2,060,002	$ 2,312,365

XML

Condensed Interim Consolidated Balance Sheets (Parenthetical) - $ / shares	Oct. 31, 2020	Apr. 30, 2020
Statement of Financial Position [Abstract]
Common Stock, par value
Common Stock, shares authorized
Common Stock, shares issued	93,730,212	93,730,212
Common Stock, shares outstanding	93,730,212	93,730,212

XML

Condensed Interim Consolidated Statements of Loss (Unaudited) - USD ($)	3 Months Ended		6 Months Ended
	Oct. 31, 2020	Oct. 31, 2019	Oct. 31, 2020	Oct. 31, 2019
OPERATING EXPENSES
Amortization	$ 808	$ 981	$ 5,870	$ 3,305
Management and consulting fees	50,365	44,569	100,524	101,513
Mineral property expenditures	159,971	444,967	298,461	724,205
General and miscellaneous	50,758	72,928	88,670	136,811
Professional fees	27,069	49,030	97,451	111,398
Operating Expenses	(288,971)	(612,475)	(590,976)	(1,077,232)
OTHER (EXPENSES) INCOME
Foreign exchange gain	(1,046)	(1,310)	6,933	(1,015)
Accretion expense		(34,810)		(60,348)
Interest expense	(913,544)	(751,201)	(1,803,653)	(1,488,711)
Change in fair value of derivative liabilities		7,457		3,143
LOSS FOR THE PERIOD	$ (1,203,561)	$ (1,392,339)	$ (2,387,696)	$ (2,624,163)
Loss per share - basic and diluted	$ (0.01)	$ (0.02)	$ (0.03)	$ (0.03)
Weighted average number of shares outstanding	93,730,212	92,676,115	93,730,212	92,676,115

XML

Condensed Interim Consolidated Statements of Cash Flows (Unaudited) - USD ($)	6 Months Ended
	Oct. 31, 2020	Oct. 31, 2019
OPERATING ACTIVITIES
Net loss for the period	$ (2,387,696)	$ (2,624,163)
Items not involving cash:
Amortization	5,870	3,305
Stock-based compensation		888
Accretion expense		60,348
Change in fair value of derivative liabilities		(3,143)
Change in non-cash operating working capital items:
Receivables	3,811	(315)
Prepaids	(1,960)	15,326
Accounts payable and accrued liabilities	1,836,285	1,667,750
Lease liability	(277)
Cash flows used in operating activities	(543,967)	(880,004)
INVESTING ACTIVITIES
Additions to mineral property interest and deferred development		(4,953)
Purchase of equipment	(879)	(2,658)
Cash flows used in investing activities	(879)	(7,611)
FINANCING ACTIVITIES
Promissory notes received	250,000	680,000
Cash flows from financing activities	250,000	680,000
DECREASE IN CASH	(294,846)	(207,615)
CASH, BEGINNING OF THE PERIOD	347,887	241,721
CASH, END OF THE PERIOD	53,041	34,106
SUPPLEMENTAL CASH FLOW INFORMATION
Interest paid
Taxes paid

XML

Condensed Interim Consolidated Statements of Capital Deficit (Equity) (Unaudited) - USD ($)	Common Stock	Commitment to Issue Shares	Additional Paid-In Capital	Accumulated Deficit [Member]	Total
Beginning Balance at Apr. 30, 2019	$ 19,118,229	$ 106,858	$ 1,866,274	$ (43,010,566)	$ (21,919,205)
Beginning Balance (in Shares) at Apr. 30, 2019	92,676,115
Share-based payments - vesting			888		888
Reallocation of vested options to liabilities			(1,820)		(1,820)
Loss for the period				(2,624,163)	(2,624,163)
Ending Balance at Oct. 31, 2019	$ 19,118,229	106,858	1,865,342	(45,634,729)	(24,544,300)
Ending Balance (Shares) at Oct. 31, 2019	92,676,115
Shares issued as a debt discount	$ 106,858	(106,858)
Shares issued as a debt discount (Shares)	1,054,097
Ending Balance at Apr. 30, 2020	$ 19,225,087		1,865,342	(48,127,316)	$ (27,036,887)
Ending Balance (Shares) at Apr. 30, 2020	93,730,212				93,730,212
Adoption of ASU 2018-07 adjustment				16,541	$ 16,541
Loss for the period				(2,387,696)	(2,387,696)
Ending Balance at Oct. 31, 2020	$ 19,225,087		$ 1,865,342	$ (50,498,471)	$ (29,408,042)
Ending Balance (Shares) at Oct. 31, 2020	93,730,212				93,730,212

XML

NATURE OF BUSINESS AND BASIS OF PRESENTATION AND LIQUIDITY

6 Months Ended

Oct. 31, 2020

Accounting Policies [Abstract]

NATURE OF BUSINESS AND BASIS OF PRESENTATION AND LIQUIDITY

1.       NATURE OF BUSINESS AND BASIS OF PRESENTATION AND LIQUIDITY:

I-Minerals Inc. (the “Company”) was incorporated under the laws of British Columbia, Canada, in 1984. The Company is listed for trading on the TSX Venture Exchange under the symbol “IMA” and the OTCQB marketplace under the symbol “IMAHF”.

The Company’s principal business is the development of the Helmer-Bovill industrial mineral property (“the Property”) located in Latah County, Idaho. Since inception, the Company has been in the exploration and evaluation stage but moved into the development stage in fiscal 2018. In fiscal 2019, the Company reverted back to the evaluation stage as management determined that the Feasibility Study on the property should be considered non-current. The Helmer-Bovill property is comprised of eleven mineral leases that host potentially economic deposits of feldspar, quartz and kaolinitic clays, primarily kaolinite and halloysite.

Basis of Presentation and Going Concern

The accompanying unaudited condensed interim consolidated financial statements have been prepared by the Company in accordance with accounting principles generally accepted in the United States of America (“US GAAP”) for interim financial information as well as Article 10 of Regulation S-X on the basis that the Company will continue as a going concern, which assumes that the Company will be able to meet its obligations and continue its operations for the next year. Realization values may be substantially different from carrying values as shown and these financial statements do not give effect to adjustments that would be necessary to the carrying values and classification of assets and liabilities should the Company be unable to continue as a going concern. At October 31, 2020, the Company had not yet achieved profitable operations, had an accumulated deficit of $50,498,471 since inception and expects to incur further losses in the development of its business, all of which casts substantial doubt upon the Company’s ability to continue as a going concern and, therefore, that it may be unable to realize its assets and discharge its liabilities in the normal course of business.

The Company’s ability to continue as a going concern is dependent upon its ability to obtain the necessary financing to develop the Property and to meet its obligations and repay its liabilities arising from normal business operations when they come due. Although the Company has been successful in the past in obtaining financing, there is no assurance that it will be able to obtain adequate financing in the future or that such financing will be on terms advantageous to the Company. The Company has been receiving funds from a company controlled by a director of the Company through promissory notes (Notes 6 and 11). Management has no formal plan in place to address this concern but considers that the Company will be able to obtain additional funds by equity financing and/or promissory notes; however, there is no assurance of additional funding being available. The Company has historically satisfied its capital needs primarily by issuing equity securities and/or promissory notes. Management plans to continue to provide for its capital needs by issuing equity securities and/or promissory notes.

On January 30, 2020, the World Health Organization ("WHO") announced a global health emergency because of a new strain of coronavirus originating in Wuhan, China (the "COVID-19 outbreak”) and the risk to the international community as the virus spreads globally beyond its point of origin. In March 2020, the WHO classified the COVID-19 outbreak as a pandemic, based on the rapid increase in exposure globally.

The full impact of the COVID-19 outbreak continues to evolve. As such, it is uncertain as the full magnitude that the pandemic will have on the Company's financial condition and liquidity. Management is actively monitoring the global situation and its potential impact. Given the daily evolution of the COVID-19 outbreak and the global responses to curb its spread, the Company is not able to estimate the effect of the COVID-19 outbreak on management's assumptions for fiscal year 2021. Although the Company cannot estimate the length or the gravity of the impact of the COVID-19 outbreak at this time, the longer the pandemic continues, the greater the likelihood that it will have an adverse effect on the Company's financial position in fiscal year 2021.

XML

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

6 Months Ended

Oct. 31, 2020

Accounting Policies [Abstract]

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:

Financial Instruments and Fair Value Measures

The book value of cash, receivables, accounts payable and accrued liabilities approximate their fair values due to the immediate or short-term maturity of those instruments. The fair value hierarchy under US GAAP is based on three levels of inputs, of which the first two are considered observable and the last unobservable, that may be used to measure fair value which are the following:

Level 1 - quoted prices (unadjusted) in active markets for identical assets or liabilities;

Level 2 - observable inputs other than Level I, quoted prices for similar assets or liabilities in active prices whose inputs are observable or whose significant value drivers are observable; and

Level 3 - assets and liabilities whose significant value drivers are unobservable by little or no market activity and that are significant to the fair value of the assets or liabilities.

The Company’s promissory notes are based on Level 2 inputs in the Accounting Standards Codification (“ASC”) 820 fair value hierarchy. The Company calculated the fair value of these instruments by discounting future cash flows using rates representative of current borrowing rates. At October 31, 2020, the promissory notes had a fair value of $19,627,032 (April 30, 2020 – $18,347,095).

Earnings (Loss) Per Share

The basic loss per common share is computed by dividing net loss available to common stockholders by the weighted average number of common shares outstanding. Diluted loss per common share is computed similar to basic loss per common share except that the denominator is increased to include the number of additional common shares that would have been outstanding if the potential common shares had been issued and if the additional common shares were dilutive. For the six months ended October 31, 2020, loss per share excludes 2,750,000 (October 31, 2019 – 5,979,097) potentially dilutive common shares (related to outstanding options and warrants as well as shares committed to be issued pursuant to the promissory notes) as their effect was anti-dilutive.

Adoption of New Accounting Pronouncements

Fair Value Measurements

In August 2018, the Financial Accounting Standards Board (“FASB”) issued ASU No. 2018-13, "Disclosure Framework—Changes to the Disclosure Requirements for Fair Value Measurement" which adds the disclosure of the range and weighted average of significant unobservable inputs used to develop Level 3 fair value measurements. Certain alternatives apply. Effective May 1, 2020, the Company adopted the new standard. The adoption of this ASU did not result in any adjustments to the financial statements.

Compensation – Stock Compensation

In June 2018, the FASB issued ASU No. 2018-07, “Compensation – Stock Compensation (Topic 718), Improvements to Nonemployee Share-Based Payment Accounting” (“ASU 2018-07”), which aligns the measurement and classification guidance for share-based payments to nonemployees with that for employees, with certain exceptions. It expands the scope of ASC 718 to include share-based payments granted to nonemployees in exchange for goods or services used or consumed in the entity’s own operations and supersedes the guidance in ASC 505-50. The ASU retains the existing cost attribution guidance, which requires entities to recognize compensation cost for nonemployee awards in the same period and in the same manner (i.e. capitalize or expense) they would if they paid cash for the goods or services, but it moves the guidance to ASC 718. Effective May 1, 2020, the Company adopted the new standard. Upon adoption, the Company applied the modified retrospective transition approach and recorded an adjustment on May 1, 2020 to decrease derivative liabilities by $16,541 and decrease opening deficit by $16,541.

XML

MINERAL PROPERTY INTEREST AND DEFERRED DEVELOPMENT COSTS

6 Months Ended

Oct. 31, 2020

Extractive Industries [Abstract]

MINERAL PROPERTY INTEREST AND DEFERRED DEVELOPMENT COSTS

3.       MINERAL PROPERTY INTEREST AND DEFERRED DEVELOPMENT COSTS:

Helmer-Bovill Property – Latah County, Idaho

The Company has an undivided 100% interest in 11 State of Idaho mineral leases. The State of Idaho mineral leases are subject to a 5% production royalty on gross sales. The mineral leases are in good standing until March 1, 2023 at which time they will be held by us contingent on production.

In May 2017, the Idaho Department of Lands accepted our operation and reclamation plan. Together with a water rights permit from the Idaho Department of Water Resources, we were able to proceed with development and construction of the mine, subject to obtaining sufficient financing. As a result, management made the decision to begin capitalizing all development expenditures directly related to the Helmer-Bovill Property. In February 2019, the Company determined that the Feasibility Study should be considered non-current and accordingly, the Company has returned to the evaluation stage for accounting purposes.

XML

ACCOUNTS PAYABLE AND ACCRUED LIABILITIES

6 Months Ended

Oct. 31, 2020

Payables and Accruals [Abstract]

ACCOUNTS PAYABLE AND ACCRUED LIABILITIES

4.       ACCOUNTS PAYABLE AND ACCRUED LIABILITIES:

	October 31, 2020 $	April 30, 2020 $
Trade payables	169,025	157,419
Amounts due to related parties (Note 8)	220,130	199,104
Interest payable on promissory notes (Note 6)	1,515,507	1,386,571
Total accounts payable and accrued liabilities	1,904,662	1,743,094

XML

LEASE LIABILITY

6 Months Ended

Oct. 31, 2020

Debt Disclosure [Abstract]

LEASE LIABILITY

5.       LEASE LIABILITY:

The Company entered into a property lease in October 2020 and the Company recognized a lease obligation with respect to the operating lease. The terms and the outstanding balances as at October 31, 2020 are as follows:

	October 31, 2020 $
Right-of-use asset from property lease repayable in monthly instalments of $2,332 and an interest rate of 13% per annum and an end date of October 15, 2022	49,048
Less: current portion	(27,982)
Non-current portion	21,066

The following is a schedule of the Company’s future minimum lease payments related to the office lease obligation:

	October 31, 2020 $
2021	13,991
2022	27,982
2023	13,991
Total minimum lease payments	55,964
Less: imputed interest	(6,916)
Total present value of minimum lease payments	49,048
Less: current portion	(27,982)
Non-current portion	21,066

XML

PROMISSORY NOTES

6 Months Ended

Oct. 31, 2020

Debt Disclosure [Abstract]

PROMISSORY NOTES

6.       PROMISSORY NOTES:

	October 31, 2020 $	April 30, 2020 $
Third promissory notes	24,906,446	23,493,003
Fifth promissory notes	2,989,937	2,793,833
Sixth promissory notes	1,617,951	1,302,781
Total promissory notes	29,514,334	27,589,617

The Company has Third Promissory Notes, Fifth Promissory Notes and Sixth Promissory Notes due to a company controlled by a director of the Company (the “Lender”). The Third Promissory Notes were due on March 31, 2019. On March 27, 2019, an amending agreement was entered into extending the maturity date of the Promissory Notes from March 31, 2019 to June 30, 2019 for no consideration. On June 28, 2019, the Company entered into an amending agreement with the Lender further extending this maturity date to October 31, 2019 for no consideration. The Fifth Promissory Notes were due on December 31, 2019. On October 25, 2019, the Company entered into an amending agreement with the Lender extending the maturity date for both notes, for no consideration, to the earlier of (i) June 30, 2020 and (ii) 60 days after a pre-feasibility study has been filed on SEDAR. The Sixth Promissory Notes have the same maturity date. On June 4, 2020, all three promissory notes were extended to December 15, 2020 for no consideration. On December 3, 2020, the maturity date was extended to March 15, 2021 for no consideration.

In accordance with the guidance of ASC 470-50 and ASC 470-60, the Company determined that the March 27, 2019, June 28, 2019, October 25, 2019 and June 4, 2020 extension agreements qualified as troubled debt restructurings. However, as the Company did not transfer assets or grant an equity interest to the Lender and since the carrying amount of the promissory notes at the time of the restructurings did not exceed the total future cash payments specified by the new terms, there was no accounting impact of the troubled debt modifications.

Certain conditions may result in early repayment including immediate repayment in the event a person currently not related to the Company acquires more than 40% of the outstanding common shares of the Company.

Third Promissory Notes

The Third Promissory Notes bear interest at the rate of 12% per annum and during the six months ended October 31, 2020, the Company recorded interest of $1,492,264 (2019 - $1,327,764). Interest is payable semi-annually as calculated on May 31^st and November 30^th of each year. Interest is to be paid either in cash, in common shares or deemed an advance of principal at the option of the Lender. A 5% late payment penalty may apply if payment is not paid within ten days after the due date. During the six months ended October 31, 2020, the Lender elected to have interest payable from December 1, 2019 to May 31, 2020 of $1,413,443 deemed as advances.

Fifth Promissory Notes

On September 11, 2018, the Company entered into a Loan Agreement with the Lender pursuant to which up to $2,500,000 will be advanced to the Company in tranches (the “Fifth Promissory Notes”). As at October 31, 2020, the Company had received $2,500,000 (April 30, 2020 - $2,500,000) in advances pursuant to the Fifth Promissory Notes.

The Fifth Promissory Notes bear interest at the rate of 14% per annum and during the six months ended October 31, 2020, the Company recorded interest of $208,684 (2019 - $160,947). Interest is payable semi-annually as calculated on May 31^st and November 30^th of each year. Interest is to be paid either in cash, in common shares or deemed an advance of principal at the option of the Lender. A 5% late payment penalty may apply if payment is not paid within ten days after the due date. During the six months ended October 31, 2020, the Lender elected to have interest payable from December 1, 2019 to May 31, 2020 of $196,104 deemed as advances.

Sixth Promissory Notes

On October 25, 2019, the Company entered into a Loan Agreement with the Lender pursuant to which up to $700,000 will be advanced to the Company in tranches (the “Sixth Promissory Notes”). On January 20, 2020 and July 8, 2020, the Company entered into amending agreements whereby the Lender agreed to advance an additional $600,000 and $1,200,000, respectively, under the same terms as the Sixth Promissory Notes. As at October 31, 2020, the Company had received $1,550,000 in advances pursuant to the Sixth Promissory Notes (April 30, 2020 - $1,300,000).

The Sixth Promissory Notes bear interest at the rate of 14% per annum and during the six months ended October 31, 2020, the Company recorded interest of $102,705 (2019 - $nil). Interest is payable semi-annually as calculated on May 31^st and November 30^th of each year. Interest is to be paid either in cash, in common shares or deemed an advance of principal at the option of the Lender. A 5% late payment penalty may apply if payment is not paid within ten days after the due date. During the six months ended October 31, 2020, the Lender elected to have interest payable from December 1, 2019 to May 31, 2020 of $65,170 deemed as advances.

The Third Promissory Notes, the Fifth Promissory Notes and the Sixth Promissory Notes are collateralized by the Company’s Helmer-Bovill Property.

The following table outlines the estimated cash payments required, by calendar year, in order to repay the principal balance of the Third Promissory Notes, the Fifth Promissory Notes and the Sixth Promissory Notes:

2020 $	2021 $	2022 $	2023 $	2024 $	Total $
29,514,334	-	-	-	-	29,514,334

XML

SHARE CAPITAL

6 Months Ended

Oct. 31, 2020

Share-based Payment Arrangement [Abstract]

SHARE CAPITAL

7.       SHARE CAPITAL:

Common shares

a) Authorized:

Unlimited number of common shares, without par value.

The holders of common shares are entitled to receive dividends which are declared from time to time, and are entitled to one vote per share at meetings of the Company. All shares are ranked equally with regards to the Company’s residual assets.

b) Stock transactions:

During the six months ended October 31, 2020 or 2019, the Company did not complete any stock transactions.

c) Stock options:

The Company has granted stock options under the terms of its Stock Option Plan (the “Plan”). The Plan provides that the directors of the Company may grant options to purchase common shares to directors, officers, employees and service providers of the Company on terms that the directors of the Company may determine are within the limitations set forth in the Plan. The maximum number of shares available under the Plan is limited to 10% of the issued common shares. The maximum term of stock options is ten years. All stock options vest on the date of grant, unless otherwise stated. As at October 31, 2020, the Company had 6,623,021 stock options available for grant pursuant to the Plan (April 30, 2020 – 6,423,021).

The Company’s stock options outstanding as at October 31, 2020 and the changes for the period then ended are as follows:

	Number Outstanding	Weighted Average Exercise Price (in CAD$)
Balance outstanding at April 30, 2020	2,950,000	0.26
Expired	(200,000)	0.25
Balance outstanding at October 31, 2020	2,750,000	0.26
Balance exercisable at October 31, 2020	1,500,000	0.26

Summary of stock options outstanding at October 31, 2020:

Security	Number Outstanding	Number Exercisable	Exercise Price (CAD$)	Expiry Date	Remaining Contractual Life (years)
Stock options	300,000	300,000	0.30	July 21, 2021	0.72
Stock options	1,000,000	1,000,000	0.25	April 20, 2022	1.47
Stock options	(1)1,450,000	(1)200,000	0.25	August 9, 2023	2.77

Notes:

⁽¹⁾ 1,250,000 stock options vest on the completion of certain milestones including equity financing, project financing, mine construction and achieving commercial production. 200,000 stock options vested as to 25% every three months from the date of grant.

As at October 31, 2020, the unamortized compensation cost of options is $93,382 and the intrinsic value of options expected to vest is $nil.

Share-based payments are classified in the Company’s Statement of Loss during the six months ended October 31, 2020 and 2019 as follows:

	2020 $	2019 $
Management and consulting fees	-	888
	-	888

XML

RELATED PARTY TRANSACTIONS

6 Months Ended

Oct. 31, 2020

Related Party Transactions [Abstract]

RELATED PARTY TRANSACTIONS

8.       RELATED PARTY TRANSACTIONS:

During the six months ended October 31, 2020, management and consulting fees of $48,000 (2019 - $48,000) were charged by RJG Capital Corporation, a wholly-owned company of W. Barry Girling, Director. Wayne Moorhouse, Director, charged $8,320 (2019 - $8,320) in management and consulting fees. Gary Childress, Director, charged $6,705 (2019 - $6,805) in management and consulting fees. $12,350 (2019 - $12,760) was charged by Malaspina Consultants Inc. for the services of Matt Anderson, CFO, and are included in professional fees.

Included in accounts payable and accrued liabilities are amounts owed to directors or officers or companies controlled by them. As at October 31, 2020, the amount was $220,130 (April 30, 2020 – $199,104). All amounts are non-interest bearing, unsecured, and due on demand.

The promissory notes received from a company controlled by a director (Note 6) are related party transactions.

XML

SEGMENT DISCLOSURES

6 Months Ended

Oct. 31, 2020

Segment Reporting [Abstract]

SEGMENT DISCLOSURES

9.       SEGMENT DISCLOSURES:

The Company considers its business to comprise a single operating segment being the exploration and development of its resource property. Substantially all of the Company’s long-term assets and operations are located in Latah County, Idaho.

XML

NON-CASH TRANSACTIONS

6 Months Ended

Oct. 31, 2020

Supplemental Cash Flow Elements [Abstract]

NON-CASH TRANSACTIONS

10.       NON-CASH TRANSACTIONS:

Investing and financing activities that affect recognized assets or liabilities but that do not result in cash receipts or cash payments are excluded from the consolidated statements of cash flows. During the six months ended October 31, 2020, the following transactions were excluded from the consolidated statement of cash flows:

a) The transfer of $1,674,717 of interest payable on the Third, Fifth and Sixth Promissory Notes from accounts payable and accrued liabilities to promissory notes; and,

b) Deferred mineral property expenditures of $40,062 included in accounts payable and accrued liabilities at October 31, 2020, less $40,062 included in accounts payable at April 30, 2020 (net inclusion of $nil).

During the six months ended October 31, 2019, the following transactions were excluded from the consolidated statement of cash flows:

a) The transfer of $1,358,420 of interest payable on the Third and Fifth Promissory Notes from accounts payable and accrued liabilities to promissory notes; and,

b) Deferred mineral property expenditures of $52,791 included in accounts payable and accrued liabilities at October 31, 2019, less $57,744 included in accounts payable at April 30, 2019 (net inclusion of $4,953).

XML

SUBSEQUENT EVENTS

6 Months Ended

Oct. 31, 2020

Subsequent Events [Abstract]

SUBSEQUENT EVENTS

11.       SUBSEQUENT EVENTS:

Subsequent to October 31, 2020:

i) On November 5, 2020, the Company received $100,000 pursuant to the Sixth Promissory Notes and on December 3, 2020 the Company received $200,000.

ii) On December 3, 2020, the maturity date of the promissory notes was extended to March 15, 2021 for no consideration.

XML

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)

6 Months Ended

Oct. 31, 2020

Accounting Policies [Abstract]

Financial Instruments and Fair Value Measures

Financial Instruments and Fair Value Measures

The book value of cash, receivables, accounts payable and accrued liabilities approximate their fair values due to the immediate or short-term maturity of those instruments. The fair value hierarchy under US GAAP is based on three levels of inputs, of which the first two are considered observable and the last unobservable, that may be used to measure fair value which are the following:

Level 1 - quoted prices (unadjusted) in active markets for identical assets or liabilities;

Level 2 - observable inputs other than Level I, quoted prices for similar assets or liabilities in active prices whose inputs are observable or whose significant value drivers are observable; and

Level 3 - assets and liabilities whose significant value drivers are unobservable by little or no market activity and that are significant to the fair value of the assets or liabilities.

The Company’s promissory notes are based on Level 2 inputs in the Accounting Standards Codification (“ASC”) 820 fair value hierarchy. The Company calculated the fair value of these instruments by discounting future cash flows using rates representative of current borrowing rates. At October 31, 2020, the promissory notes had a fair value of $19,627,032 (April 30, 2020 – $18,347,095).

Earnings (Loss) Per Share

Earnings (Loss) Per Share

The basic loss per common share is computed by dividing net loss available to common stockholders by the weighted average number of common shares outstanding. Diluted loss per common share is computed similar to basic loss per common share except that the denominator is increased to include the number of additional common shares that would have been outstanding if the potential common shares had been issued and if the additional common shares were dilutive. For the six months ended October 31, 2020, loss per share excludes 2,750,000 (October 31, 2019 – 5,979,097) potentially dilutive common shares (related to outstanding options and warrants as well as shares committed to be issued pursuant to the promissory notes) as their effect was anti-dilutive.

Fair Value Measurements

Fair Value Measurements

In August 2018, the Financial Accounting Standards Board (“FASB”) issued ASU No. 2018-13, "Disclosure Framework—Changes to the Disclosure Requirements for Fair Value Measurement" which adds the disclosure of the range and weighted average of significant unobservable inputs used to develop Level 3 fair value measurements. Certain alternatives apply. Effective May 1, 2020, the Company adopted the new standard. The adoption of this ASU did not result in any adjustments to the financial statements.

Compensation - Stock Compensation

Compensation – Stock Compensation

In June 2018, the FASB issued ASU No. 2018-07, “Compensation – Stock Compensation (Topic 718), Improvements to Nonemployee Share-Based Payment Accounting” (“ASU 2018-07”), which aligns the measurement and classification guidance for share-based payments to nonemployees with that for employees, with certain exceptions. It expands the scope of ASC 718 to include share-based payments granted to nonemployees in exchange for goods or services used or consumed in the entity’s own operations and supersedes the guidance in ASC 505-50. The ASU retains the existing cost attribution guidance, which requires entities to recognize compensation cost for nonemployee awards in the same period and in the same manner (i.e. capitalize or expense) they would if they paid cash for the goods or services, but it moves the guidance to ASC 718. Effective May 1, 2020, the Company adopted the new standard. Upon adoption, the Company applied the modified retrospective transition approach and recorded an adjustment on May 1, 2020 to decrease derivative liabilities by $16,541 and decrease opening deficit by $16,541.

XML

ACCOUNTS PAYABLE AND ACCRUED LIABILITIES (Tables)

6 Months Ended

Oct. 31, 2020

Payables and Accruals [Abstract]

Schedule of Accounts Payable And Accrued Liabilities

	October 31, 2020 $	April 30, 2020 $
Trade payables	169,025	157,419
Amounts due to related parties (Note 8)	220,130	199,104
Interest payable on promissory notes (Note 6)	1,515,507	1,386,571
Total accounts payable and accrued liabilities	1,904,662	1,743,094

XML

LEASE LIABILITY (Tables)

6 Months Ended

Oct. 31, 2020

Debt Disclosure [Abstract]

Schedule of Leases

	October 31, 2020 $
Right-of-use asset from property lease repayable in monthly instalments of $2,332 and an interest rate of 13% per annum and an end date of October 15, 2022	49,048
Less: current portion	(27,982)
Non-current portion	21,066

Schedule of Future Minimum Lease Payments

	October 31, 2020 $
2021	13,991
2022	27,982
2023	13,991
Total minimum lease payments	55,964
Less: imputed interest	(6,916)
Total present value of minimum lease payments	49,048
Less: current portion	(27,982)
Non-current portion	21,066

XML

PROMISSORY NOTES (Tables)

6 Months Ended

Oct. 31, 2020

Debt Disclosure [Abstract]

Schedule of Promissory Notes

	October 31, 2020 $	April 30, 2020 $
Third promissory notes	24,906,446	23,493,003
Fifth promissory notes	2,989,937	2,793,833
Sixth promissory notes	1,617,951	1,302,781
Total promissory notes	29,514,334	27,589,617

Schedule of Payments To Repay Principal Balance

2020 $	2021 $	2022 $	2023 $	2024 $	Total $
29,514,334	-	-	-	-	29,514,334

XML

SHARE CAPITAL (Tables)

6 Months Ended

Oct. 31, 2020

Share-based Payment Arrangement [Abstract]

Stock Options Outstanding

	Number Outstanding	Weighted Average Exercise Price (in CAD$)
Balance outstanding at April 30, 2020	2,950,000	0.26
Expired	(200,000)	0.25
Balance outstanding at October 31, 2020	2,750,000	0.26
Balance exercisable at October 31, 2020	1,500,000	0.26

Summary Of Stock Options Outstanding

Security	Number Outstanding	Number Exercisable	Exercise Price (CAD$)	Expiry Date	Remaining Contractual Life (years)
Stock options	300,000	300,000	0.30	July 21, 2021	0.72
Stock options	1,000,000	1,000,000	0.25	April 20, 2022	1.47
Stock options	(1)1,450,000	(1)200,000	0.25	August 9, 2023	2.77

Income Statement Share-based payments

	2020 $	2019 $
Management and consulting fees	-	888
	-	888

XML

ACCOUNTS PAYABLE AND ACCRUED LIABILITIES (Detail) - Schedule of Accounts Payable And Accrued Liabilities - USD ($)	Oct. 31, 2020	Apr. 30, 2020
Payables and Accruals [Abstract]
Trade payables	$ 169,025	$ 157,419
Amounts due to related parties	220,130	199,104
Interest payable on promissory notes	1,515,507	1,386,571
Total accounts payable and accrued liabilities	$ 1,904,662	$ 1,743,094

XML

LEASE LIABILITY (Detail) - Schedule of Leases - USD ($)	6 Months Ended
	Oct. 31, 2020	Apr. 30, 2020
Right-of-use Asset	$ 27,982
Non-current portion	21,066
Operating Leases [Member]
Right-of-use Asset	49,048
Less: current portion	(27,982)
Non-current portion	21,066
Monthly Payments	$ 2,332
Interest Rate	13.00%

XML

LEASE LIABILITY (Detail) - Schedule of Future Minimum Lease Payments - USD ($)	Oct. 31, 2020	Apr. 30, 2020
Total present value of minimum lease payments	$ 27,982
Non-current portion	21,066
Operating Leases [Member]
2021	13,991
2022	27,982
2023	13,991
Total minimum lease payments	55,964
Less: imputed interest	(6,916)
Total present value of minimum lease payments	49,048
Less: current portion	(27,982)
Non-current portion	$ 21,066

XML

PROMISSORY NOTES (Detail) - Schedule of Promissory Notes - USD ($)	Oct. 31, 2020	Apr. 30, 2019
Third Promissory Note [Member]
Promissory notes	$ 24,906,446	$ 23,493,003
Fifth Promissory Note [Member]
Promissory notes	2,989,937	2,793,833
Sixth Promissory Note [Member]
Promissory notes	1,617,951	1,302,781
Total [Member]
Promissory notes	$ 29,514,334	$ 27,589,617

XML

PROMISSORY NOTES (Detail) - Schedule of Payments To Repay Principal Balance - Promissory Notes [Member]	Oct. 31, 2020 USD ($)
2020	$ 29,514,334
2021
2022
2023
2024
Total	$ 29,514,334

XML

SHARE CAPITAL (Detail) - Stock Options Outstanding	6 Months Ended
	Oct. 31, 2020 $ / shares shares
Share-based Payment Arrangement [Abstract]
Outstanding, Beginning | shares	2,950,000
Outstanding, Weighted Average Exercise Price, Beginning | $ / shares	$ 0.26
Expired | shares	(200,000)
Expired, Weighted Average Exercise Price | $ / shares	$ 0.25
Outstanding, Weighted Average Exercise Price | $ / shares	$ 0.26
Outstanding, End | shares	2,750,000
Exercisable, Weighted Average Exercise Price | $ / shares	$ 0.26
Exercisable | shares	1,500,000

XML

SHARE CAPITAL (Detail) - Summary Of Stock Options Outstanding	6 Months Ended
	Oct. 31, 2020 $ / shares shares
Exercisable	1,500,000
Set 1 [Member]
Type of Security	Stock options
Outstanding	300,000
Exercisable	300,000
Exercise Price (CAD$) | $ / shares	$ 0.30
Expiry Date	Jul. 21, 2021
Remaining Contractual Life (years)	262 days 19 hours 12 minutes
Set 2 [Member]
Type of Security	Stock options
Outstanding	1,000,000
Exercisable	1,000,000
Exercise Price (CAD$) | $ / shares	$ 0.25
Expiry Date	Apr. 20, 2022
Remaining Contractual Life (years)	1 year 171 days 13 hours 12 minutes
Set 3 [Member]
Type of Security	Stock options
Outstanding	1,450,000
Exercisable	200,000
Exercise Price (CAD$) | $ / shares	$ 0.25
Expiry Date	Aug. 09, 2023
Remaining Contractual Life (years)	2 years 281 days 1 hour 12 minutes

XML

SHARE CAPITAL (Detail) - Income Statement Share-based payments - USD ($)	6 Months Ended
	Oct. 31, 2020	Oct. 31, 2019
Share-based Payment Arrangement [Abstract]
Share Based Payments, Management and consulting fees		$ 888
Total		$ 888

XML

NATURE OF BUSINESS AND BASIS OF PRESENTATION AND LIQUIDITY (Details Narrative) - USD ($)	Oct. 31, 2020	Apr. 30, 2020
Accounting Policies [Abstract]
Accumulated Deficit	$ 50,498,471	$ 48,127,316

XML

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) - USD ($)	6 Months Ended
	Oct. 31, 2020	Oct. 31, 2019	Apr. 30, 2020
Shares Excluded from Loss Per Share, potentially dilutive	2,750,000	5,979,097
Promissory Notes [Member]
Notes Fair Value	$ 19,627,032		$ 18,347,095

XML

MINERAL PROPERTY INTEREST (Details Narrative) - Idaho [Member]	6 Months Ended
	Oct. 31, 2020
Mineral Leases Interest	100.00%
Number of Mineral Leases	11
Mineral Royalty	The State of Idaho mineral leases are subject to a 5% production royalty on gross sales.

XML

PROMISSORY NOTES (Details Narrative) - USD ($)	3 Months Ended		6 Months Ended		12 Months Ended
	Oct. 31, 2020	Oct. 31, 2019	Oct. 31, 2020	Oct. 31, 2019	Apr. 30, 2020
Accretion Expense		$ 34,810		$ 60,348
Third Promissory Notes [Member]
Interest Rate	12.00%		12.00%
Interest Terms			Interest is payable semi-annually as calculated on May 31st and November 30th of each year. Interest is to be paid either in cash, in common shares or deemed an advance of principal at the option of the Lender. A 5% late payment penalty may apply if payment is not paid within ten days after the due date.	Interest is payable semi-annually as calculated on May 31st and November 30th of each year. Interest is to be paid either in cash, in common shares or deemed an advance of principal at the option of the Lender. A 5% late payment penalty may apply if payment is not paid within ten days after the due date.
Interest Recorded			$ 1,492,264	$ 1,327,764
Debt Conversion			During the six months ended October 31, 2020, the Lender elected to have interest payable from December 1, 2019 to May 31, 2020 of $1,413,443 deemed as advances.
Fifth Promissory Notes [Member]
Promissory Notes Description			On September 11, 2018, the Company entered into a Loan Agreement with the Lender pursuant to which up to $2,500,000 will be advanced to the Company in tranches (the “Fifth Promissory Notes”). As at October 31, 2020, the Company had received $2,500,000 (April 30, 2020 - $2,500,000) in advances pursuant to the Fifth Promissory Notes.
Promissory Notes Advances	$ 2,500,000		$ 2,500,000		$ 2,500,000
Interest Rate	14.00%		14.00%		14.00%
Interest Terms			Interest is payable semi-annually as calculated on May 31st and November 30th of each year. Interest is to be paid either in cash, in common shares or deemed an advance of principal at the option of the Lender. A 5% late payment penalty may apply if payment is not paid within ten days after the due date.	Interest is payable semi-annually as calculated on May 31st and November 30th of each year. Interest is to be paid either in cash, in common shares or deemed an advance of principal at the option of the Lender. A 5% late payment penalty may apply if payment is not paid within ten days after the due date.
Interest Recorded			$ 208,684	$ 160,947
Debt Conversion			During the six months ended October 31, 2020, the Lender elected to have interest payable from December 1, 2019 to May 31, 2020 of $196,104 deemed as advances.
Sixth Promissory Notes [Member]
Promissory Notes Description			On October 25, 2019, the Company entered into a Loan Agreement with the Lender pursuant to which up to $700,000 will be advanced to the Company in tranches (the “Sixth Promissory Notes”). On January 20, 2020 and July 8, 2020, the Company entered into amending agreements whereby the Lender agreed to advance an additional $600,000 and $1,200,000, respectively, under the same terms as the Sixth Promissory Notes.
Interest Terms			Interest is payable semi-annually as calculated on May 31st and November 30th of each year. Interest is to be paid either in cash, in common shares or deemed an advance of principal at the option of the Lender. A 5% late payment penalty may apply if payment is not paid within ten days after the due date.		Interest is payable semi-annually as calculated on May 31st and November 30th of each year. Interest is to be paid either in cash, in common shares or deemed an advance of principal at the option of the Lender. A 5% late payment penalty may apply if payment is not paid within ten days after the due date.
Interest Recorded			$ 550,000		$ 1,300,000
Debt Conversion			During the six months ended October 31, 2020, the Lender elected to have interest payable from December 1, 2019 to May 31, 2020 of $65,170 deemed as advances.

XML

SHARE CAPITAL (Details Narrative) - USD ($)	6 Months Ended
	Oct. 31, 2020	Oct. 31, 2019	Apr. 30, 2020
Share-based Payment Arrangement [Abstract]
Shares Issued, Shares
Shares Issued, Value
Exercise Price
Stock Options Available For Grant	6,623,021		6,423,021
Unamortized Compensation Cost of Options	$ 93,382

XML

RELATED PARTY TRANSACTIONS (Details Narrative) - USD ($)	3 Months Ended		6 Months Ended
	Oct. 31, 2020	Oct. 31, 2019	Oct. 31, 2020	Oct. 31, 2019	Apr. 30, 2020
Management And Consulting Fees	$ 50,365	$ 44,569	$ 100,524	$ 101,513
Professional fees	27,069	$ 49,030	97,451	111,398
Accounts payable and accrued liabilities	1,904,662		1,904,662		$ 1,743,094
RJG Capital Corporation [Member]
Management And Consulting Fees			48,000	48,000
Wayne Moorhouse, Director [Member]
Management And Consulting Fees			8,320	8,320
Gary Childress, Director [Member]
Management And Consulting Fees			6,705	6,805
Malaspina Consultants Inc. [Member]
Professional fees			12,350	$ 12,760
Directors Or Officers Or Companies Controlled By Them [Member]
Accounts payable and accrued liabilities	$ 220,130		$ 220,130		$ 199,104

XML

NON-CASH TRANSACTIONS (Details Narrative) - USD ($)	6 Months Ended
	Oct. 31, 2020	Oct. 31, 2019	Apr. 30, 2020
Shares Issued, Shares
Shares Issued, Fair Value
Accounts payable and accrued liabilities	1,904,662		$ 1,743,094
Deferred Mineral Property Expenditures [Member]
Accounts payable and accrued liabilities	40,062	52,791
Promissory Notes [Member]
Transfer of Interest Payable to Promissory Note	$ 1,674,717	$ 1,358,420

XML

SUBSEQUENT EVENTS (Details Narrative)	Dec. 03, 2020	Nov. 05, 2020
Subsequent Events [Abstract]
Event Date	Dec. 03, 2020	Nov. 05, 2020
Event Description	On December 3, 2020, the maturity date of the promissory notes was extended to March 15, 2021 for no consideration.	On November 5, 2020, the Company received $100,000 pursuant to the Sixth Promissory Notes and on December 3, 2020 the Company received $200,000.